The world’s biggest Bitcoin and altcoin crypto exchange, Binance, launched its joint anti-scam campaign after the Hong Kong pilot run. The new campaign collaborates with law enforcement agencies to fight an alarming uptrend in crypto-related scams worldwide. It will feature a withdrawal warning message that prevents users from sending their crypto to scammers. Crime fighters worldwide have seen a worrying increase in traditional and crypto-related scams, and Binance is now taking action.

On March 3 2023, Binance announced on the company’s blog post that it cooperates with law enforcement agencies to prevent scams by issuing targeted alerts to potential victims. The “Joint Anti-Scam Campaign” project aims to empower users to identify and avoid scammers and seek help in the event of a possible attack. The project rolled out first in Hong Kong, and the company intends to expand it into other jurisdictions. Binance’s post detailed, “We recently launched the Joint Anti-Scam Campaign in partnership with law enforcement agencies across the globe.”

Overview of the Campaign 

According to Binance’s post, the campaign started in Hong Kong. They worked with the Hong Kong Police Force’s Cyber Security and Technology Crime Bureau to assemble a targeted alert and crime prevention message incorporating helpful tips. For example, when users tried to withdraw their earnings, they were presented with warning messages that gave them information about common fraud and tips on how to avoid them.

The global cryptocurrency firm claimed the project had achieved tremendous results — results that were commended by the team at the well-known crypto organisation,Bitcoin Decode. They noted, “In the first four weeks since its launch, approximately 20.4% of users had either reconsidered the withdrawal or reviewed whether the transaction carried the risk of scam.”

The Cyber Security and Technology Crime Bureau (CSTCB) for the Hong Kong Police Force said, “Hong Kong Police is emphasising effective crime prevention. Consequently, we joined forces with different stakeholders, including Binance, to deliver the key crime prevention advice to the relevant users.”

According to Binance, while promoting its other anti-scam initiatives, it wants to cooperate with law enforcement agencies in other regions. Binance added, “The Joint Anti-Scam Campaign complements our existing anti-crime and crime prevention initiatives worldwide.”

In 2001, the warning provided statistics on several scams in Hong Kong and recommended resources like Binance Verify, the Anti-Deception Coordination Center, Cyber Defender and Scameter. Binance also instructed users that it would never call them directly.

In 2022, Binance announced its existing anti-scam initiatives, consisting of general operational law enforcement assistance and the Global Law Enforcement Training Program. The crypto exchanges consider the pilot program a success. It plans to collaborate with police in other jurisdictions outside of Hong Kong to make tailor-made warning messages for customers.

Previous Scams

Chainalysis, a blockchain data analytics firm, reported that crypto scam revenues dropped 46% in 2022. Particular crypto scams are rising; on December 28 2022, the Federal Bureau of Investigation (FBI) warned users about crypto scams. The fraud has been sweeping across the US, on social media and dating apps. 

Frank Fisher, a Public Affairs Specialist at the FBI’s Albuquerque Division, said, “Be very careful when you go on social media and dating apps and somebody starts developing a relationship with you and wants you to start investing … Don’t get butchered.”

According to District Attorney Jeff Rosen of Santa Clara County, California, scammers “fatten up the pig by getting the victim to think that they’re investing in something and get them to move money into cryptocurrency… and then steal the money”.

On February 20 2023, a fake Ethereum Denver website was created to fleece unsuspecting victims’ browser-based wallets. Hackers duplicated the website to trick users into connecting their MetaMask wallets. Blockfence identified the fraudulent website; it is said that the smart contract has accessed more than 2,800 wallets and stolen over $300,000 over the past six months.

CEO of Blockfence Omri Lahav said, “Since the smart contract was deployed almost six months ago, it’s possible that it was used on other phishing websites.” ETHDenver issued a notice to its followers warning them of the malicious website. 

In another example, on January 4 2023, a non-fungible token (NFT) influencer became a victim of a cyber-attack and lost two CryptoPunks. The influencer posted their rage and included a screenshot from OpenSea showing two CryptoPunks being transferred to another address.

Hacks and scams continue to be commonplace in the cryptocurrency ecosystem, and Binance’s new campaign intends to eradicate and educate its users globally. We consider this a highly important move for the community as a whole to feel that they are protected when making investments.

By: Hannah Parker