Binance released findings this week on how scammers build fake credibility in the crypto space. The exchange's risk intelligence team, Binance Sentry, conducted the investigation using blockchain anal
Binance released findings this week on how scammers build fake credibility in the crypto space. The exchange's risk intelligence team, Binance Sentry, conducted the investigation using blockchain analysis and public data sources. Their work uncovered how fraudsters dangle promises of quick or explosive gains to recruit victims, targeting and harassing those new to investing.
The schemes market high returns across multiple asset classes beyond cryptocurrency. They pitch forex, binary options, and contracts for difference alongside cryptocurrency opportunities. The Organized Crime and Corruption Reporting Project (OCCRP) examined a network operating from a Kyiv call center, showing how widespread these operations run.
This report follows a recent Bitcoin scam targeting Winnipeg residents.
Scammers layer their deception through multiple methods. "These schemes sometimes operate under the facade of different, seemingly unrelated brands, and it is not uncommon for dozens of projects to be branches of the same malicious operation," Binance's report states. One arm handles crypto while another targets forex traders or CFD buyers, making the network harder to trace.
False legitimacy serves as their weapon. The UK's Financial Conduct Authority and Italy's CONSOB have documented how criminals use multiple identities to con victims. Some establish fake consumer groups that pressure victims for additional money if they grow skeptical. They also fabricate regulatory bodies and government agencies to reinforce legitimacy.
The infrastructure extends far beyond the scammers themselves. Binance found that ancillary operations—marketing firms, law offices, human resources departments, rating agencies—prop up the network. "We have also seen the use of related ancillary services, including marketing outfits and law firms, human resources teams, and project rating sites. The goal of this is to cultivate credibility and further support these networks' activities, many ostensibly doubling as legitimate operations," the report noted.
Cracking down becomes difficult because these operations cross borders. Victims scatter across multiple countries and legal jurisdictions, making it hard for law enforcement in any single region to connect the dots. Authorities struggle to link disparate cases because their victims live under different legal systems.
Binance's message to users remains straightforward: distrust pledges of fast money. "We encourage our community to beware of promises of quick returns on investments and to always DYOR (do your own research) on services and projects before using them or investing in them," the exchange said.
