Elliptics New AI Model Offers Breakthrough in Detecting Crypto Money Laundering

The crypto industry, like any industry, has certain challenges that it has to contend with. One of these is the use of digital assets for criminal activity. This includes the alleged theft of crypto by North Korean hacking groups, phishing schemes targeting everyday users, money laundering, and much more.

Now, Elliptic, a crypto tracing firm, has published fresh research that shows new ways to track crypto money laundering across crypto exchanges. This was done with an AI that scoured the public Bitcoin blockchain and followed clusters of transactions from illicit wallets.

After collecting this information, which included analysing groups of 6 transactions from each address, Elliptic co-referenced it with data from an unnamed crypto exchange. The result was that the accounts identified matched up with those the exchange had found to be suspicious. More specifically, 14 out of 52 accounts were correctly flagged as illicit.

This essentially means that crypto exchanges and other industry stakeholders can better track illicit activities and flag criminals faster. It is also important that this is being done to train an AI model.

As we've said, crypto being used for crime is an important issue within the crypto sector and businesses like exchanges are constantly on the lookout for criminals. But there is only so much humans can do about the issue. Fatigue, error, and other factors must be considered which AI can help to address.

Because this research is being made public, other firms can build on the data already available and perhaps, crypto money laundering and other crimes can be reduced. Billions of dollars each year are lost to crypto criminals and even a little bit more efficiency in tracing their activities and catching them is welcome.

Even with this, crypto users are still advised to practice safe asset use and storage. Crypto assets are being used on more platforms than ever before and this comes with a lot of responsibility. As Sergio Zammit points out, crypto casinos accept everything from Bitcoin to Solana and are only growing more popular.

Many consumers also put their tokens on all sorts of trading platforms, from centralised to decentralized ones. Cryptos are also used on gaming platforms, social websites, and much more. As crypto is being used in all of these different ways, consumers need to make sure that they are being as safe as possible.

When their tokens are not being actively used, they should be stored in a secure wallet, ideally a cold wallet. The password and recovery phrase of said wallet should be kept as secure as possible to avoid falling into the wrong hands.

Consumers should also avoid clicking on sketchy links or downloading any unverified software and this is a common tactic by criminals to gain access to funds. They should also avoid using sketchy or unverified platforms for gambling, trading, gaming, and whatnot as copycat websites are not unheard of. With caution from users and continued research, crypto crime can be reduced moving forward.

COMTEX_452344855/2891/2024-05-14T05:12:55

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