AI Could Detect Money Laundering on Bitcoin Blockchain: Elliptic Report
Researchers from blockchain forensic firm Elliptic, IBM Watson and MIT have together made advances in using artificial intelligence (AI) to identify money laundering on the Bitcoin blockchain.
A recent report released Wednesday by Elliptic revealed that the researchers used deep learning model to successfully detect crypto crimes. Dubbed “Enhancing Blockchain Analytics Through AI,” the findings aim to help customers to assess risks in crypto assets, more accurately.
New Elliptic research released today explores how #AI can be leveraged to detect money laundering and other financial crime on the blockchain. The research applies new techniques to a dataset containing 200m+ transactions, which is now publicly available. https://t.co/k3GdjWJ08P
— Elliptic (@elliptic) May 1, 2024
The deep learning AI model detects money laundering patterns and identify crypto wallets used in crimes, it noted. Elliptic wrote that unlike traditional finance, where transaction data is typically “siloed” making it challenging, blockchain provides transparency to apply these techniques.
“Blockchains provide fertile ground for machine learning techniques, thanks to the availability of both transaction data and information on the types of entities that are transacting, collected by us and others.”
Further, Elliptic highlighted how a machine learning model is trained to detect ‘subgraphs’ chains of transactions, which are known to represent Bitcoin money laundering.
“This approach allows us to focus on the ‘multi-hop’ laundering process more generally rather than the on-chain behavior of specific illicit actors,” it added.
Put simply, the researchers used patterns of Bitcoin transactions that led from bad actors to crypto exchanges. They used these example
Read more on cryptonews.com
