Source: Global Government Fintech

Global Government Fintech reports that the U.S. Department of the Treasury has launched a public consultation to gather information on the use of new technologies, including artificial intelligence and machine learning, to combat illicit finance related to crypto-assets. The Treasury is seeking input from a wide range of stakeholders, such as financial institutions, technology providers, law enforcement, and academics, on the current capabilities and future potential of these advanced analytical tools. The consultation aims to understand how technology can be more effectively leveraged to identify and disrupt illicit activities like money laundering, terrorist financing, and sanctions evasion that exploit the perceived anonymity of digital currencies.

The request for information (RFI) covers several key areas. The Treasury is interested in learning about innovative techniques for tracing transactions across different blockchains, methodologies for clustering addresses to identify illicit actors, and the use of AI to detect anomalous patterns that may indicate criminal behavior. The consultation also seeks to understand the challenges and limitations of these technologies, including issues related to data privacy, the accuracy and explainability of AI models, and the potential for algorithmic bias. The insights gathered from this process will inform the Treasury's strategy for enhancing its own analytical capabilities and for developing new regulations or guidance for the private sector. This initiative signals a significant move by the U.S. government to stay ahead of the curve in the fight against financial crime in the rapidly evolving digital asset ecosystem.