Enhanced Anomaly Detection in Ethereum: Unveiling and Classifying Threats With Machine Learning

Abstract

Blockchain has emerged as a groundbreaking security technology, playing a vital role in various industries such as banking, the Internet of Things (IoT), healthcare, education, and voting. However, the widespread adoption of this technology has introduced certain vulnerabilities, particularly in the form of exploitation by malicious entities. While existing research primarily focuses on identifying anomalous actor behavior, there has been limited exploration of precisely identifying hostile actors within the Ethereum network. This study aims to uncover malevolent actors operating on the Ethereum network and categorize attacks based on their actions. To achieve this research goal, a new dataset was constructed by consolidating data on malicious actors involved in illicit Ethereum activities. Key features were extracted from this dataset using advanced feature selection techniques, including Principal Component Analysis (PCA), Information Gain, and Ridge Regression. Machine learning classifiers such as LGBM, XGBoost, Random Forest, Extra Tree, Bagging, and K-Nearest Neighbors were applied to identify and classify malicious actors effectively. The results, achieving an impressive accuracy rate of 98%, underscore the effectiveness of Information Gain when coupled with LGBM and XGBoost. Notably, XGBoost demonstrates efficiency by completing the analysis in a mere 13.72 seconds. In addition to identifying fraudulent activities, this research classifies them into distinct categories, enhancing blockchain security and addressing trust concerns. This study’s outcomes fortify the Ethereum network’s resilience and contribute to the broader discourse on bolstering reliability in blockchain systems.

Keywords

• Ethereum
• malicious actor
• anomaly detection system
• phishing
• PCA
• information gain