U.S. Treasury says AI could detect crypto money-laundering schemes

Digital-asset service providers suggested to U.S. Treasury Department staff that AI could be used to detect illicit money-laundering patterns, such as "chain-hopping," where funds are shifted between different blockchains privacy-oriented bridges to obscure the flow.

The report was delivered to Congress this week, after being mandated under last year's GENIUS Act.

AI bots also might be able to spot instances of crypto "smurfing," where large sums are broken up into small deposits across multiple wallets so the movements won't draw as much attention, according to the report.