Frauds and Hackings In The Crypto World - How One Company Can Help Keep Your Digital Assets Safe By Sam Msiska, Benzinga
Flensburg, Schleswig-Holstein
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September 30, 2022 08:00 AM Eastern Daylight Time
Cryptocurrencies have flipped a lot of norms around the world. From finance and banking to e-commerce, it would appear there is no industry where cryptocurrencies haven’t made their presence felt.
The massive public interest in these digital assets truly began in 2017. The crypto craze gained momentum in that year when Bitcoin (CRYPTO: BTC) witnessed an unprecedented boom. Several companies offering various cryptocurrency solutions such as MEXC Global and TaxBit Inc. have emerged since the start of the craze.
While many industries were disrupted during the COVID-19 pandemic, the crypto industry didn’t experience a dent — instead, it soared even higher. Cryptocurrencies boomed as more people became interested in decentralized currencies as a safe haven amid global economic tension.
Since then, the cryptocurrency market’s total value has reached over $1 trillion, having hit $3 trillion in November 2021 and now competing with the market capitalization of multinational conglomerates such as Amazon.com Inc. (NASDAQ: AMZN), Microsoft Corp. (NASDAQ: MSFT) and Alphabet Inc. (NASDAQ: GOOGL).
Crypto Scams And Hacks Soar
However, risks persist amidst the perceived optimism. The crypto world is experiencing an increasing number of attacks and continues to draw more scammers. Scammers stole more than $14 billion in 2021, with losses from crypto-crime rising by 80% compared to 2020, according to a report by blockchain research group Chainalysis.
Crypto scamming is an increasingly common method for fraudsters to get people’s money. More than 46,000 people have filed crypto-related fraud cases with the Federal Trade Commission (FTC) from January 2021 through March, according to a report released by the agency. The median loss reported from these schemes is a sizable $2,600.
Ever since cryptocurrencies started gaining popularity, the internet has been flooded with scammers involving giving bogus giveaways. Group-IB, a Singapore-based cybersecurity firm, reports a significant fivefold increase in domains offering fake crypto giveaways including through YouTube streaming pages in the first quarter of 2022.
In the first six months of the year, experts at Group-IB have identified more than 2,000 domains being used as fake crypto promotion pages. The number of fake pages promoting fake giveaways increased sharply from 583 in the first quarter to over 1,500 in the second quarter.
Hackers have also targeted crypto exchanges and blockchain platforms to steal large amounts of valuable digital currencies. At least 46 crypto exchanges and blockchain platforms have reported losing over $2 billion since 2012 because of security breaches in their system.
Just some months ago, hackers infiltrated the blockchain gaming platform Ronin Network and walked away with more than $600 million worth of digital currencies. The blockchain-based platform Poly Network was a victim of a similar attack late last year when attackers stole over $620 million worth of users’ assets.
Worldwide Crackdown On Crypto Scams And Hacks
The U.S. Department of the Treasury has called for other federal organizations to expand and increase their crackdown on crypto scams and hacks.
In the U.K., experts have warned that crypto scamming could get worse as the cost of living rises.
“We are concerned that, in current economic circumstances, people could be tempted to invest in fake investments,” said Nausicaa Delfas, interim chief executive of the Financial Ombudsman Service.
Securing Blockchain Ecosystems With Smart Contract Auditing
With so much money at stake and blockchain protocols becoming more complex, smart contract auditing firms such as Chainsulting are gaining importance as a necessity in a fairly unregulated space. Smart contract auditing is a systematic method of manually and automatically reviewing the structured code of a smart contract to find flaws.
A smart contract audit is a useful tool to assess a company’s operations and ensure that the code is accurate and reflecting the use case. The auditor will conduct a comprehensive review of the smart contract codebase and make recommendations on how to fix possible flaws. Smart contract auditing has many advantages, including ensuring security, preventing vulnerabilities and securing user funds.
Chainsulting says it can perform smart contract audits for Ethereum (CRYPTO: ETH), Solana (CRYPTO: SOL), Aptos, Binance Smart Chain and many more. The company also says it provides audit solutions using German technology and security standards, which rank first in the world in terms of crypto-friendliness.
Chainsulting audits involve several stages. First, the code goes through automated vulnerability tests in which security analysis tools such as Mythril, Slither and Oyente are used to detect security vulnerabilities. The code is then checked manually for weaknesses before the general function of the code and business logic is double-checked. If any critical issues are found, the team makes recommendations on how to resolve them.
Chainsulting has conducted over 300 notable smart contract security audits since its inception in 2017.
Chainsulting is a professional software development firm, founded in 2017 and based in Germany. They show ways, opportunities, risks and offer comprehensive web3 solutions. Their services include web3 development, security and consulting. Chainsulting conducts code audits on market-leading blockchains such as Solana, Tezos, Ethereum, Binance Smart Chain, and Polygon to mitigate risk and instil trust and transparency into the vibrant crypto community. They have also reviewed and secure the smart contracts of 1Inch, POA Network, Unicrypt, LUKSO among numerous other top DeFi projects. Chainsulting currently secures $100 billion in user funds locked in multiple DeFi protocols. The team behind the leading audit firm relies on their robust technical know-how in the web3 sector to deliver top-notch smart contract audit solutions, tailored to the clients' evolving business needs.
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