Adopting Artificial Intelligence to Strengthen Legal Safeguards in Blockchain Smart Contracts: A Strategy to Mitigate Fraud and Enhance Digital Transaction Security
As blockchain technology increasingly underpins digital transactions, smart contracts have emerged as a pivotal tool for automating these transactions. While smart contracts offer efficiency and security, their automation introduces significant legal challenges. Detecting and preventing fraud is a p...
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| Format: | Article |
| Language: | English |
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MDPI AG
2024-08-01
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| Series: | Journal of Theoretical and Applied Electronic Commerce Research |
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| Online Access: | https://www.mdpi.com/0718-1876/19/3/104 |
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| author | Hassen Louati Ali Louati Abdulla Almekhlafi Maha ElSaka Meshal Alharbi Elham Kariri Youssef N. Altherwy |
| author_facet | Hassen Louati Ali Louati Abdulla Almekhlafi Maha ElSaka Meshal Alharbi Elham Kariri Youssef N. Altherwy |
| author_sort | Hassen Louati |
| collection | DOAJ |
| description | As blockchain technology increasingly underpins digital transactions, smart contracts have emerged as a pivotal tool for automating these transactions. While smart contracts offer efficiency and security, their automation introduces significant legal challenges. Detecting and preventing fraud is a primary concern. This paper proposes a novel application of artificial intelligence (AI) to address these challenges. We will develop a machine learning model, specifically a Convolutional Neural Network (CNN), to effectively detect and mitigate fraudulent activities within smart contracts. The AI model will analyze both textual and transactional data from smart contracts to identify patterns indicative of fraud. This approach not only enhances the security of digital transactions on blockchain platforms but also informs the development of legal standards and regulatory frameworks necessary for governing these technologies. By training on a dataset of authentic and fraudulent contract examples, the proposed AI model is expected to offer high predictive accuracy, thereby supporting legal practitioners and regulators in real-time monitoring and enforcement. The ultimate goal of this project is to contribute to legal scholarship by providing a robust technological tool that aids in preventing cybercrimes associated with smart contracts, thereby laying a foundation for future legal research and development at the intersection of law, technology, and security. |
| format | Article |
| id | doaj-art-3dede05dab3145f2a59ea457a55178f4 |
| institution | OA Journals |
| issn | 0718-1876 |
| language | English |
| publishDate | 2024-08-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Journal of Theoretical and Applied Electronic Commerce Research |
| spelling | doaj-art-3dede05dab3145f2a59ea457a55178f42025-08-20T01:55:35ZengMDPI AGJournal of Theoretical and Applied Electronic Commerce Research0718-18762024-08-011932139215610.3390/jtaer19030104Adopting Artificial Intelligence to Strengthen Legal Safeguards in Blockchain Smart Contracts: A Strategy to Mitigate Fraud and Enhance Digital Transaction SecurityHassen Louati0Ali Louati1Abdulla Almekhlafi2Maha ElSaka3Meshal Alharbi4Elham Kariri5Youssef N. Altherwy6College of Information Technology, Kingdom University, Riffa 40434, BahrainDepartment of Information Systems, College of Computer Engineering and Sciences, Prince Sattam Bin Abdulaziz University, Al-Kharj 11942, Saudi ArabiaCollege of Law, Kingdom University, Riffa 40434, BahrainCollege of Law, Kingdom University, Riffa 40434, BahrainDepartment of Computer Science, College of Computer Engineering and Sciences, Prince Sattam Bin Abdulaziz University, Al-Kharj 11942, Saudi ArabiaDepartment of Information Systems, College of Computer Engineering and Sciences, Prince Sattam Bin Abdulaziz University, Al-Kharj 11942, Saudi ArabiaDepartment of Information Systems, College of Computer Engineering and Sciences, Prince Sattam Bin Abdulaziz University, Al-Kharj 11942, Saudi ArabiaAs blockchain technology increasingly underpins digital transactions, smart contracts have emerged as a pivotal tool for automating these transactions. While smart contracts offer efficiency and security, their automation introduces significant legal challenges. Detecting and preventing fraud is a primary concern. This paper proposes a novel application of artificial intelligence (AI) to address these challenges. We will develop a machine learning model, specifically a Convolutional Neural Network (CNN), to effectively detect and mitigate fraudulent activities within smart contracts. The AI model will analyze both textual and transactional data from smart contracts to identify patterns indicative of fraud. This approach not only enhances the security of digital transactions on blockchain platforms but also informs the development of legal standards and regulatory frameworks necessary for governing these technologies. By training on a dataset of authentic and fraudulent contract examples, the proposed AI model is expected to offer high predictive accuracy, thereby supporting legal practitioners and regulators in real-time monitoring and enforcement. The ultimate goal of this project is to contribute to legal scholarship by providing a robust technological tool that aids in preventing cybercrimes associated with smart contracts, thereby laying a foundation for future legal research and development at the intersection of law, technology, and security.https://www.mdpi.com/0718-1876/19/3/104smart contract enforcementAI fraud detection in blockchainlegal aspects of artificial intelligence |
| spellingShingle | Hassen Louati Ali Louati Abdulla Almekhlafi Maha ElSaka Meshal Alharbi Elham Kariri Youssef N. Altherwy Adopting Artificial Intelligence to Strengthen Legal Safeguards in Blockchain Smart Contracts: A Strategy to Mitigate Fraud and Enhance Digital Transaction Security Journal of Theoretical and Applied Electronic Commerce Research smart contract enforcement AI fraud detection in blockchain legal aspects of artificial intelligence |
| title | Adopting Artificial Intelligence to Strengthen Legal Safeguards in Blockchain Smart Contracts: A Strategy to Mitigate Fraud and Enhance Digital Transaction Security |
| title_full | Adopting Artificial Intelligence to Strengthen Legal Safeguards in Blockchain Smart Contracts: A Strategy to Mitigate Fraud and Enhance Digital Transaction Security |
| title_fullStr | Adopting Artificial Intelligence to Strengthen Legal Safeguards in Blockchain Smart Contracts: A Strategy to Mitigate Fraud and Enhance Digital Transaction Security |
| title_full_unstemmed | Adopting Artificial Intelligence to Strengthen Legal Safeguards in Blockchain Smart Contracts: A Strategy to Mitigate Fraud and Enhance Digital Transaction Security |
| title_short | Adopting Artificial Intelligence to Strengthen Legal Safeguards in Blockchain Smart Contracts: A Strategy to Mitigate Fraud and Enhance Digital Transaction Security |
| title_sort | adopting artificial intelligence to strengthen legal safeguards in blockchain smart contracts a strategy to mitigate fraud and enhance digital transaction security |
| topic | smart contract enforcement AI fraud detection in blockchain legal aspects of artificial intelligence |
| url | https://www.mdpi.com/0718-1876/19/3/104 |
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