Crypto Scam Report Shows Web3 Experienced 15 New Fake Smart Contracts

Solidus Labs functions to perform crypto operations based on the crypto-native T3 (Triple T) market integration solutions (MIS). These market solutions include threat intelligence, transaction monitoring and trade monitoring.

Its primary mission is to ensure the security of crypto transactions and investments through all decentralized finance (DeFi) and centralized markets. Solidus Labs, located in New York, USA, started its operations in 2017.

Meanwhile, around 12 leading blockchains are under the company’s radar to detect possible theft or fraud cases. The need to monitor and perform threat monitoring in the crypto industry is necessary, considering the high possibility of fraud.

Most of the scams detected came from a crypto exchange platform’s chain known as BNB Chain. In addition to this, more and more cyber threats are emerging, and recently the Web3 system has detected 15 new fraud cases.

Main information about the scam

Solidus Labs has detected around 188,525 dating scams. The reported cases came from some blockchains among the 12 monitored blockchains. These blockchains include BNB Chain, Polygon and Ethereum.

According to Kathy Kraninger, there were several cases of fraud that Solidus Labs was unable to identify. This is evident from the company’s data. This means that there is a need for extra effort from the company since fraud cases snowball. Kathy Kraninger is Solidus’ regulatory vice president and former US Consumer Financial Protection Bureau director.

Fraud rate per token

According to the company’s data, the BEP-20 tokens had the highest recorded cases. In addition, these tokens operate on the BNB chain, giving the blockchain approximately 12% of the detected cases.

The company stated that the percentage of fraudulent tokens on the Ethereum blockchain, ERC-20, was 8%, after BEP-20. Also, around $910 million of ETH tokens were lost in the scam. The report said the transactions occurred on regulated and centralized crypto exchange platforms.

The idea behind crypto scams

Based on the Solidus report, the objectives and mission of the culprits were relatively straightforward. They aim to deprive investors of their assets by using hard-wire mechanism. To achieve this purpose, they entice investors to invest their funds in tokens that have no future but appear to have one.

The system used for this operation is automated. First of all, the fraudsters repeat the process with the contracts. This process enables fraudsters to gain access to organizations such as stock exchanges, governments and regulators.

According to Chainalysis, an analytical firm, investors need to be careful with their transactions in the crypto ecosystem. This is because cases of crypto theft can come in different ways, except fraud.

There are also chances of hacking into investors’ accounts, especially those with little knowledge of crypto.

Featured image from Pexels, chart from TradingView.com