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Breaking News: SOL Strategies: The First Solana Treasury Company Listed On Nasdaq

Binance CEO Shares Details Of $20 Million Scam Attempt

Semilore Faleti
Semilore Faleti
1 year ago
3 mins read
Binance CEO

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Binance CEO, Changpeng ‘CZ’ Zhao has recently provided details on a failed $20 million scam attempt in a bid to keep the crypto community on alert for future occurrences.

Crypto Scammers Are “So Good Now,” Binance CEO Says

In a tweet on August 2, Changpeng Zhao described a recent scam attempt as “clever,” stating that it was “luckily” prevented as the bad actors in the crypto space seem to have gotten better. 

Related Reading: Curve DAO (CRV) Price Recovery Post-Exploit: What Would Be A Realistic Scenario?

Specifically, the Binance CEO drew attention to how these scammers now generate addresses with identical starting and ending letters as other wallet addresses.

Using these new addresses, they then proceed to impersonate other network participants and swindle unsuspecting crypto users. Technically, these kinds of scams are referred to as  “zero-transfer phishing attacks.”

I want to share this (luckily) unsuccessful, but very clever and close scam incident from yesterday 👇. Saved $20m. Hope it may also save you one day.

The scammers are so good now they generate addresses with the same starting and ending letters, which is what most people check… https://t.co/DFpdX8aNay

— CZ 🔶 Binance (@cz_binance) August 2, 2023

Changpeng Zhao noted that these scams are particularly effective as most crypto users only confirm the first and last characters of an address when conducting transactions.

In fact, he stated that most wallet designs exclude the middle parts of addresses in an attempt to offer a better user interface to users

Asides from creating similar wallet addresses, the Binance CEO mentioned that these scammers would send “dust transactions” so they could be registered in their targets’ transaction history.

To explain, dust refers to a minute amount of cryptocurrency, usually valued at less than a cent, and cannot be traded on any exchange. 

With the scammer’s address now present in their target’s transaction history, one can unknowingly transfer assets to these bad actors, especially if the impersonated address is one they constantly transact with.

 

Binance CEO

Total crypto market cap valued at $1.13 trillion on the 4-hour chart | Source: TOTAL chart on Tradingview.com

Fast Response Helped Thwart Zero-Transfer Phishing Attack

Changpeng Zhao stated that a zero phishing attack happened to a veteran crypto operator on Aug 1 in which they transferred $20 million worth of USDT to the wrong address.

For context, the original wallet address was 0xa7Bf48749D2E4aA29e3209879956b9bAa9E90570, while the phishing address was 0xa7B4BAC8f0f9692e56750aEFB5f6cB5516E90570.

Luckily, the operator detected the scam quickly, and Binance was able to officially request for Tether to freeze the stolen USDT. The stablecoin operator responded promptly by blacklisting the wallet to prevent any further deposit or withdrawal. 

Related Reading: Ethereum DeFi Coins Plunge As Curve Concerns Threaten Major Market Crash

The Binance CEO rounded off his tweet by stating that a fast reaction was vital to reclaiming users’ funds in these kinds of attacks. However, he did state that the assets recovery may take some time as the sender would have to complete a number of processes, including submitting a police report. 

It is no news that the crypto space is riddled with heists, scams, and attacks which result in the loss of millions of dollars yearly. And these crypto scams are considered one of the major plagues in the crypto space.

According to data from Certik Security, crypto scams and hacks claimed over $313 million in just Q2 2023 alone. Another report from TRM Labs in June 2023 said that over $9 billion was lost to various scams and frauds in 2022. A huge portion (around $7.8 billion) of this figure was lost to Ponzi schemes alone, TRM added. 

Featured image from Binance, chart from Tradingview

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Semilore Faleti
Semilore Faleti

Semilore Faleti

Semilore Faleti is a cryptocurrency writer specialized in the field of journalism and content creation. While he started out writing on several subjects, Semilore soon found a knack for cracking down on the complexities and intricacies in the intriguing world of blockchains and cryptocurrency.

Read more

Semilore is drawn to the efficiency of digital assets in terms of storing, and transferring value. He is a staunch advocate for the adoption of cryptocurrency as he believes it can improve the digitalization and transparency of the existing financial systems.

In two years of active crypto writing, Semilore has covered multiple aspects of the digital asset space including blockchains, decentralized finance (DeFi), staking, non-fungible tokens (NFT), regulations and network upgrades among others.

In his early years, Semilore honed his skills as a content writer, curating educational articles that catered to a wide audience. His pieces were particularly valuable for individuals new to the crypto space, offering insightful explanations that demystified the world of digital currencies.

Semilore also curated pieces for veteran crypto users ensuring they were up to date with the latest blockchains, decentralized applications and network updates. This foundation in educational writing has continued to inform his work, ensuring that his current work remains accessible, accurate and informative.

Currently at NewsBTC, Semilore is dedicated to reporting the latest news on cryptocurrency price action, on-chain developments and whale activity. He also covers the latest token analysis and price predictions by top market experts thus providing readers with potentially insightful and actionable information.

Through his meticulous research and engaging writing style, Semilore strives to establish himself as a trusted source in the crypto journalism field to inform and educate his audience on the latest trends and developments in the rapidly evolving world of digital assets.

Outside his work, Semilore possesses other passions like all individuals. He is a big music fan with an interest in almost every genre. He can be described as a “music nomad” always ready to listen to new artists and explore new trends.

Semilore Faleti is also a strong advocate for social justice, preaching fairness, inclusivity, and equity. He actively promotes the engagement of issues centred around systemic inequalities and all forms of discrimination.

He also promotes political participation by all persons at all levels. He believes active contribution to governmental systems and policies is the fastest and most effective way to bring about permanent positive change in any society.

In conclusion, Semilore Faleti exemplifies the convergence of expertise, passion, and advocacy in the world of crypto journalism. He is a rare individual whose work in documenting the evolution of cryptocurrency will remain relevant for years to come.

His dedication to demystifying digital assets and advocating for their adoption, combined with his commitment to social justice and political engagement, positions him as a dynamic and influential voice in the industry.

Whether through his meticulous reporting at NewsBTC or his fervent promotion of fairness and equity, Semilore continues to inform, educate, and inspire his audience, striving for a more transparent and inclusive financial future.

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Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

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Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
How Our News is Made

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