It should be noted that fraud in the cryptocurrency industry is widespread. First of all, the popularity of this phenomenon is due to the decentralised nature of digital assets. That is, if a fraudster stores conditional stolen bitcoins or ethers on a full-fledged non-custodial wallet, law enforcement or the courts will not be able to get their hands on the coins.

And representatives of the blockchain industry are constantly reminding us of the activity of scammers. For example, Ledger, a French hardware wallet maker, told of a fake Ledger Live app on the Microsoft Store. The purpose of this fake software is to trick the user into obtaining their sido code, a combination for accessing cryptocurrencies at a specific address.

Well, Trezor wallet users received a message the day before about the alleged hacking of the Trezor Suite app. Potential victims were offered a link to “fix the problem”, with the hackers here also probably wanting to get their hands on other people’s sido-frauds.

Cryptocurrency exchange Binance will now be actively trying to prevent fraud.

How cryptocurrency fraud is being tackled

The main danger of modern fraud was mentioned in the official announcement of the initiative on the exchange’s website. Here’s the relevant line.

It could be a phone call, an email with a malicious link, or a direct message on Telegram asking for confidential information. Hacking into a bank vault or a crypto-exchange with first-class security is almost impossible, but tricking someone into voluntarily giving up the keys to their money using social engineering is much easier.

Indeed, there are many types of scams. Sometimes scammers will call potential victims and introduce themselves as support staff for a particular platform. In such a scenario, scammers also try to get sensitive data for authorisation on an exchange, central wallet or other similar platforms.

According to Cointelegraph’s sources, Binance is working with the Hong Kong Police’s Cybersecurity and Technology Crime Bureau to create a “crime prevention alert and reporting system” targeting Hong Kong residents. As part of the pilot project, when users tried to withdraw funds, they received alerts containing information on common types of fraud, along with tips on how to avoid them.

For four weeks, Binance studied customer reactions to such messages. It found that about 20.4 percent of users either decided not to make a withdrawal, or made sure that the transaction would not result in the loss of coins in a potential phishing attack.


We believe that 20 percent is too high a percentage in this context. Most likely, most of the users in that proportion got scared of the warning and decided to postpone withdrawing coins.

Previously, Binance already required to pass a certain test to understand the basics of blockchain in order to be able to withdraw coins. While such an idea is a good one, having to spend time to be allowed to interact with their tokens was not particularly satisfying.


The alert also mentioned links to Scameter, Cyber Defender and Binance Verify portals, which help in actively combating scammers. In addition, the mailing repeatedly repeats an important fact – representatives of the crypto-exchange will never contact a user directly to find out their password or any other confidential information.

Social engineering and phishing attacks are an ongoing problem for cryptocurrency users. For example, in February, fraudsters created a fake version of the website of the popular cryptocurrency conference ETH Denver. It was used to trick users into giving up their coins by triggering a corresponding function on a malicious smart contract. It is estimated that over $300,000 in crypto was stolen in this incident.

That is, in this case, participants tried to purchase a participation ticket using a cryptocurrency wallet. However, the smart contract used contained permission to withdraw funds from addresses, causing victims to lose significantly more than they planned to spend on the event.

Below are examples of messages received by participants in the pilot phase of the project in Hong Kong. In this case, users were encouraged to contact the experts by phone or go to certain websites. And this is a really good reminder.

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The announcement of the initiative notes that the project has received a lot of positive feedback from the Binance community. Therefore, its further development could significantly raise the cryptocurrency’s image in terms of security in the eyes of both users and regulators.

Binance has previously done much to correct the view of the crypto industry after the collapse of the FTX trading platform. The platform was the first to publish information about its reserves, backed by cryptographic tools to prove relevance. The company was followed by other major crypto exchanges in the market, which in the end definitely helped preserve the industry’s image in the eyes of the average investor.


We believe that this idea will benefit first-time cryptocurrency users in any case. The main thing is that exchange users don't have to spend a lot of time on various tests and other mandatory activities, without which you can't withdraw cryptocurrency. Such requirements sometimes cause a well-deserved annoyance, because in essence, users are not allowed to dispose of their own assets. And most of them usually don't send coins to fraudulent addresses.