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MIT research concludes only 2% of transactions in the crypto space may be illicit

05 Aug 2019 : 12:34
2 min read

Money laundering has been by far one of the most important obstacles for crypto global adoption. Traditional investors and legal bodies of several countries are avoiding and blocking the use of cryptocurrencies because of this.  However, recent research conducted by the Massachusetts Institute of Technology (MIT) proves that only 2% of all transactions are actually associated with money laundering.

The research was released and sponsored by the cryptocurrency compliance company, Elliptic, which is planning to launch a data set very soon. The report titled “Anti-Money Laundering in Bitcoin: Experiments with Graph Convolutional Networks for Financial Forensics” emphasises how economic and financial sanctions have major negative impact in the industry, that’s why Elliptic aims to continue “exploring how compliance officers can protect their businesses against exposure to cryptocurrency-related sanctions risks”.

The methodology used was simple but exhaustive. Artificial Intelligence was used to identify illicit transactions.  200,000 BTC movements, valued at $6Bn USD were analysed. The MIT research has been now crown as the largest set of labeled transaction data publicly available on the internet.

The result? Only 2% of the 200K transactions in the data set were illicit. Studies as this one must be cherished by the crypto community as law enforcement agencies around the world must be aware of the tools they can use to make crypto transactions more transparent and legitimate.

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Michela Silvestri

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