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Report: Over 50 questionable crypto projects built on the Binance blockchain

Report: Over 50 questionable crypto projects built on the Binance blockchain

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Answer Report: Over 50 questionable crypto projects built on the Binance blockchain

In an alarming development, cybersecurity firm Peckshield has revealed the existence of more than 50 questionable crypto projects based on the Binance Blockchain (BSC).

Rug-pull projects and their rise in number on the Binance Blockchain:

Rug pulls were a frequent occurrence in the crypto space in 2021.

Read:Binance seeks a license to operate in Japan 4 years after leaving

In this type of scam (pull the rug out), the developers unexpectedly abandon the project and take advantage of the users’ money and disappear with it.

Binance has been one of the hard-hit networks that has attracted many malicious actors since its inception.

In the latest development, Peckshield has published a report revealing that there are more than 50 projects built on the Binance Blockchain that have the potential to pull the rug.

The blockchain security firm has alerted the crypto community that the officials behind the aforementioned projects can make unlimited digital tokens, with the ability to restrict users from selling their cryptocurrency and even blacklist some accounts.

Projects with threats, as mentioned in the “Peckshield” list, are run by anonymous teams, and the company has deemed all projects as medium risk.

The rug pull has been going on since 2021:

The number of rug pulling projects increased dramatically in 2021, and has even become one of the most widely used scams.

According to a report by Chainalysis, rug pulls made up 37% of total fraud proceeds last year, compared to just 1% in 2020.

Read:Are we in a crypto bubble? Ark Invest CEO Answers

There are two main reasons why rug pulling is so common.

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One was the huge hype surrounding the DeFi space and the FOMO sentiment surrounding it.

Building a crypto project on an open blockchain is easy and does not require a third party to review and verify the project.

But these scams may not continue in 2022.

According to Chainalysis, crypto-related crimes may decrease as the ability of law enforcement agencies to combat these scams develops.

The same company recently stated that the growing legitimate use of cryptocurrencies far outpaces the growth of criminal use.

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