July 23, 2024


Recent research by crypto risk monitoring firm Solidus Labs has taken a deep dive into the shady world of crypto scams. The findings do not bode well for BNB Chain.

On Oct. 27, Solidus Labs announced the launch of a real-time on-chain Threat Intelligence tool. It has been touted as a first-of-its-kind approach to the retroactive methods of dealing with crypto scams.

Additionally, the firm also released its findings on the growing number of crypto scams and rug pulls. The report revealed that there has been almost 100,000 rug pulls deployed so far this year. Furthermore, the figure is already up 20% from 2021 which had 82,000 rug pulls.

BNB Chain has the most

More interestingly, Solidus Labs found that Binance’s BNB Chain had the most scams. Around 12% of all BEP-20 tokens on the network were tied to scams, it reported. Comparatively, 8% of all ERC-20 tokens were connected with scams in the Ethereum ecosystem, making it second.  

Layer 2 network Polygon was third with just 1.2% scam tokens and smart contracts.

BNB Chain was hit with a massive exploit earlier this month resulting in around $100 million in losses. The company suspended the network that it maintains is decentralized to prevent further losses. DeFiLlama reports that BNB Chain is the second largest in terms of total value locked with an 11.3% market share of $7 billion.

The scary statistics were not only related to BNB Chain. Solidus reported that there have been 188,525 smart contract scams detected over 12 blockchains as of October 10, 2022. Its Threat Intelligence tool claims that 15 scams are deployed across various networks every hour.

Furthermore, around $910 million in “scam-related ETH” has passed through centralized exchanges, it stated.

Solidus Vice President of Regulatory Affairs, Kathy Kraninger, said the big rug pulls such as the Squid token made the news. However, she cautioned that:

“The full picture stemming from our data shows the vast majority of these scams go unnoticed.”

The firm is touting its new technology as a key weapon in the war against crypto scammers.

Crypto scams surging

Earlier this year, it was reported that crypto scams rose from the seventh riskiest in 2020 to the second riskiest type of fraud in 2021.

Social media continues to be a hotbed of disseminating crypto scams and search engines such as Google listing phishing websites only compound the problems.

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