Experts Warn of New Cryptocurrency Fraud Scheme

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A new scheme of virtual currency fraud has emerged, Izvestia was told in one of the largest cryptocurrency exchanges Binance. Attackers began to create their projects of decentralized finance (DeFi, traditional but blockchain-based applications and services), while deliberately including the error in the code.

With the help of it, in the future, criminals illegally withdraw client funds through a smart contract, bypassing the algorithm that guarantees the inviolability of users’ investments, said Gleb Kostarev, director of Binance in Russia and the CIS.

DeFi projects now account for more than half of the attacks in the cryptoindustry, as more than $ 51 billion are concentrated in them, said Vyacheslav Vasin, head of the technical audit department of Group-IB.

Decentralized finance is blockchain-based applications and services that create an ecosystem within a single network. They provide access to virtually all financial services, including lending, deposits, lending and trade, while serving as an alternative to the traditional banking system. Their popularity rose especially during the pandemic.

Read more in the exclusive material from Izvestia:

Shito-crypt: a new scheme for stealing virtual currency has appeared