Research On Tracking Fund Flows Of Blockchain-based Cryptocurrency

Cryptocurrencies,by virtue of their blockchain-based trading system,have become an "independent kingdom" on the Internet.Illegal funds generated by illegal acts can flow freely in the Internet or the dark net through cryptocurrencies,while being difficult to be regulated.As a pioneer of blockchain-based cryptocurrencies,Bitcoin has the longest running time and the highest market cap.Hence,Bitcoin is chosen as the research object in this thesis,with studying its data structure and storage mechanism.By analyzing the structured Bitcoin transaction data obtained by distributed parsing,mechanisms for tracking and tracing flows of transaction funds are proposed.The tracking and tracing algorithms can be used to obtain the chain of funds for the specific transaction output,and thus realize the tracking and tracing mechanisms of the fund flows.This is the groundwork of researches on the suspicious transaction fund flow model.In the research of suspicious transaction fund flow model,based on the previous work on the concepts of same entity address clustering,this thesis defines the concept of springboard address for the wallet addresses on the fund flow tracking route with no remaining balance and few transactions to simplify the flow of funds,in which the unknown transfer relationship is caused by multi-level transfer between a large number of wallet addresses.This thesis then defines fund split sub-model and anchor address that are used as components of the suspicious transaction fund flow model along with the springboard address,in order to effectively strengthen the role that core suspicious wallet addresses played in the fund flows and their associated entities.Results of the experiments show that the suspicious transaction fund flow model proposed in this thesis can effectively track and locate the suspect entity that implemented suspicious transaction behavior.The research ideas of fund flow tracking and tracing mechanisms and suspicious transaction fund flow model proposed in this thesis helps to establish a long-term regulatory mechanism for the flows of transaction funds in blockchain-based cryptocurrencies,to find illegal activities that conceal funds in cryptocurrencies and therefore can help public security organs to collect evidence and intelligence in cases involving blockchain-based cryptocurrencies.They also provide a reference value for the regulation of sovereign cryptocurrency for China in the future.