Comparative Study of Machine Learning Algorithms for Fraud Detection in Blockchain

Fraudulent transactions have a huge impact on the economy and trust of a blockchain network. Consensus algorithms like proof of work or proof of stake can verify the validity of the transaction but not the nature of the users involved in the transactions or those who verify the transactions. This makes a blockchain network still vulnerable to fraudulent activities. One of the ways to eliminate fraud is by using machine learning techniques. Machine learning can be of supervised or unsupervised nature. In this paper, we use various supervised machine learning techniques to check for fraudulent and legitimate transactions. We also provide an extensive comparative study of various supervised machine learning techniques like decision trees, Naive Bayes, logistic regression, multilayer perceptron, and so on for the above task.