FlowShield: cryptocurrency anti-money laundering with transaction semantics parsing and fund flow tracking

Abstract

Cryptocurrency anti-money laundering (Crypto AML) is increasingly challenged by sophisticated laundering behaviors that rapidly fragment stolen assets through diverse semantics and across multiple blockchains. Existing Crypto AML methods often simplify transaction semantics, rely on topology-centric signals, or output isolated detection labels. In this paper, we present \textsc{FlowShield}, a Crypto AML framework for transaction-level laundering detection and investigator-facing report generation. \textsc{FlowShield} first recovers behavior-level semantics from observable relations, making laundering intents explicit. To trace value provenance and redistribution, \textsc{FlowShield} reconstructs fund-flow subgraphs from three complementary perspectives. It then employs a text--structure fusion mechanism, enabling the interplay between large language model (LLM)-encoded semantics and flow texts with graph convolutional network (GCN)-encoded structure. Beyond mere detection, \textsc{FlowShield} further generates readable suspicious activity reports (SARs), offering investigators concise summaries and explainable red flags. To address the data scarcity in multi-chain detection, we construct and open-source \textit{BybitML}, the first public multi-chain laundering dataset. We evaluate \textsc{FlowShield} on \textit{BybitML} and two public laundering datasets and experimental results demonstrate that \textsc{FlowShield} achieves the best overall performance, with an average F1 score of 98.0\%. Further behavior and SAR analyses demonstrate that \textsc{FlowShield} can reveal diverse laundering strategies and produce readable reports for investigating complex multi-hop fund flows.