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Beosin Report: Crypto Rug Pulls Surpass DeFi Exploits in May

Markets·June 03, 2023, 6:32 AM

According to a recent report by blockchain security firm Beosin, losses from “rug pulls” or “exit scams” in the cryptocurrency space exceeded the amount stolen from decentralized finance (DeFi) projects during the month of May.

The report, published on June 1 by Beosin Blockchain Security, revealed that rug pulls and scams resulted in losses of over $45 million across six incidents during the month. Beosin is headquartered in Chengdu, in China’s Sichuan province. The firm uses formal verification methods to secure smart contracts.

In general there were 22 security incidents in the digital assets space over the course of the month. That overall figure accounts for losses totaling $20 million, and represents a vast improvement on the previous month.

Three of the incidents were accounted for by security issues related to hardware wallets such as the Trezor and imKey wallets. Six were rug pulls/crypto scams, two were crypto crime incidents while another implicated a critical vulnerability relative to zero-knowledge proof technology.

Photo by Tara Winstead on Pexels

 

DeFi protocol attacks

In contrast, there were 10 attacks on DeFi protocols, amounting to $19.7 million in stolen funds. This figure represents a significant decrease of nearly 80% compared to April, and the losses from these types of exploits had been declining for two consecutive months, as per Beosin’s findings.

The largest rug pull incident in May involved the alleged disappearance of $32 million associated with the crypto project Fintoch on May 24. Meanwhile, the largest attack on a DeFi platform was a $7.5 million breach targeting Jimbos protocol, according to Beosin’s report.

 

Shifting hacker strategy

Beosin noted a shift in the targeting strategy of hackers and scammers, who are now increasingly focusing their attacks on ordinary users rather than various project parties. To mitigate risks, the report recommended that crypto users enhance their anti-fraud awareness, conduct thorough due diligence before investing in projects, and learn how to improve the security of their digital assets.

The report also issued a warning against using shared or public charging devices for mobile phones. Beosin highlighted the potential risks associated with these devices, as they could be manipulated to inject malicious programs that compromise private keys. This caution aligns with a similar advisory issued by the United States Federal Bureau of Investigation (FBI) in April.

The FBI’s Denver office cautioned against using public USB ports, including those found at airports, due to the potential introduction of malware and monitoring software onto devices. Instead, they suggested carrying a personal charger and USB cord for use with electrical outlets.

As the cryptocurrency landscape continues to evolve, it is crucial for users to remain vigilant and proactive in safeguarding their investments. With the rise of rug pulls and the ongoing threats in the DeFi space, staying informed, exercising caution, and adopting robust security measures are essential for protecting one’s digital assets in this rapidly changing industry.

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Web3 & Enterprise·

Jul 07, 2023

Bakkt Signals Interest in Entering Hong Kong Market

Bakkt Signals Interest in Entering Hong Kong MarketBakkt, the US digital asset platform owned by Intercontinental Exchange, Inc., the owner of the New York Stock Exchange (NYSE), has set its sights on international expansion, with Hong Kong headlining its focus on regions that offer clearer regulatory frameworks for cryptocurrencies.Photo by Jimmy Chan on PexelsGreater regulatory clarity overseasCEO Gavin Michael highlighted Hong Kong as a target market for the company, given that the autonomous Chinese territory is making rapid progress in establishing regulatory clarity, and at a faster pace than in the United States. Alongside Hong Kong, Michael also earmarked the UK and parts of the EU as possible target markets based on similar rationale.Michael made the comments while speaking at the Piper Sandler Global Exchange & FinTech Conference in New York recently. While emphasizing the company’s commitment to the US market, Michael stated that Bakkt is actively seeking markets where it can gain traction and utilize them as a catalyst for growth. The recent acquisition of Apex Crypto, an integrated crypto-trading platform based in the US, further supports Bakkt’s international plans.Leveraging existing partnershipsMichael anticipates leveraging Apex’s existing partnerships with companies such as Webull, M1, Public.com, and Stash to facilitate expansion into international markets. Bakkt aims to accompany these companies as they venture into offering US equities trading, enabling the addition of crypto trading with minimal barriers to entry. However, regulatory concerns have led to the delisting of 25 tokens on the Bakkt platform.Michael highlighted the progress being made in crypto markets outside the US, where regulatory clarity is being achieved more rapidly. He cited the UK’s advancements in clear crypto regulation, Hong Kong’s allowance of trading certain cryptocurrencies, and the EU’s implementation of the MiCA framework for crypto regulation. While supportive of recent regulatory actions in the US, Michael believes that the country needs to provide further clarity, particularly at the federal level.The lack of regulatory clarity in the US has impacted Bakkt’s ability to collaborate with domestic companies. Despite launching with notable partnerships, including Microsoft and Starbucks, Michael revealed that many firms are awaiting clear regulatory guidelines before entering the cryptocurrency space. He noted that trading activity has been slower compared to Bakkt’s custody service, as regulatory clarity plays a significant role in shaping consumer sentiment and providing operational guidelines for trading platforms.Interest in Lightning NetworkIn addition to exploring international expansion, Bakkt is actively considering the use of the Bitcoin Layer 2 Lightning Network for custody and settlement services. Michael explained that this technology has the potential to revolutionize financial services, particularly cross-border payments.Bakkt’s strategic focus on markets with regulatory clarity and its acquisition of Apex Crypto demonstrate the company’s intent to grow beyond the US. By expanding into Hong Kong, the UK, and the EU, Bakkt aims to meet the demand of partners eager to explore these markets.However, the company recognizes the need for the US to provide clearer regulatory guidelines to foster innovation and accelerate adoption within the domestic cryptocurrency industry. With its custody services gaining traction, Bakkt is still optimistic about the potential of trading as regulatory clarity continues to improve. Moreover, Bakkt’s exploration of the Lightning Network showcases its desire to leverage emerging technologies for more efficient financial services.

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Web3 & Enterprise·

Aug 03, 2023

Welcome Savings Bank Implements Blockchain-based Bank ID for Enhanced Customer Convenience

Welcome Savings Bank Implements Blockchain-based Bank ID for Enhanced Customer ConvenienceWelcome Savings Bank, one of the mutual savings banks in South Korea, has announced a significant step towards enhancing identity security and customer convenience with the incorporation of Bank ID, a blockchain-based decentralized identity (DID) solution operated by the Korea Financial Telecommunications and Clearings Institute (KFTC), a payment services institution.Photo by Jonathan Cooper on UnsplashDID technology to prevent identity fraudThe utilization of DID technology marks a notable stride in preventing identity fraud. By storing user data on a secure distributed ledger, the system becomes highly resilient to counterfeiting or forgery attempts, ensuring a safer environment for customers’ personal information.Single sign-on functionalityWith this initiative, Welcome Savings Bank has become the first savings bank in the country to implement Bank ID, a solution predominantly adopted by prime commercial banks. This strategic move bolsters the bank’s digital competitiveness and improves customer convenience. With Bank ID, users can enjoy seamless access to their accounts across 18 Korean financial institutions without the hassle of logging in separately for each one, streamlining their banking experience.Customers of Welcome Savings Bank can utilize the bank’s mobile app to acquire a Bank ID by undergoing a verification process through a one-time password or security card. For existing Bank ID holders, adding Welcome Savings Bank to their list of banks is a straightforward procedure.The decision to embrace this innovative technology highlights the bank’s commitment to meeting the high standards set by prime commercial banks. By aligning with industry trends and bolstering their digital capabilities, savings banks like Welcome and other subprime banks can deliver improved convenience and a seamless banking journey to their valued customers.

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Web3 & Enterprise·

Oct 13, 2023

Indonesian Food Industry Conglomerate Embraces Blockchain Tech

Indonesian Food Industry Conglomerate Embraces Blockchain TechIndonesia’s ID Food, a prominent state-owned food industry holding company, is embracing blockchain technology to revolutionize its fisheries operations.Photo by R Eris Prayatama on UnsplashD3 Labs CollaborationIn a strategic collaboration with Singapore-headquartered D3 Labs, a blockchain-based fintech startup, ID Food is set to usher in a new digitized fish trading process. The move leverages the power of blockchain to enhance traceability and transparency throughout the value chain while adhering to stringent fishing standards.With the backing and support of PT Perikanan Indonesia, a subsidiary specializing in the fisheries sector, ID Food will harness D3 Labs’ innovative blockchain-based solution to create a real-time fish exchange platform known as the Indonesia Fishery eXchange (IFX).Indonesia Fishery eXchange (IFX)IFX promises an array of advantages, including transparent stock monitoring and auctions, the facilitation of digital payments for seamless transactions, robust Know Your Customer (KYC) measures, and stringent account management protocols to safeguard against fictitious buyers.Furthermore, it will integrate seamlessly with digital sales markets abroad. The recent collaboration was signed by ID Food and D3 Labs in the presence of fisheries industry stakeholders from 29 countries earlier this month.Dirgayuza Setiawan, the Director of Development and Business Control at ID Food, expressed enthusiasm for the collaboration, noting the positive implications it holds for fishermen, producers, and consumers. He stated:“We recognize the importance of sustainability in the fisheries industry, especially in Indonesia, which is one of the world’s largest fish producers. In addition to improving efficiency and transparency, the use of blockchain technology can enhance productivity, the well-being of our fishing partners, and sustainability in the fisheries sector.”He added that the collaboration with D3 Labs is a commitment to drive innovation in the fisheries industry, with the goal of improving efficiency, productivity, well-being, and sustainability in this sector.Trian Yunanda, Indonesia’s Secretary of the Directorate General of Wild-Catch Fisheries at the Ministry of Maritime Affairs and Fisheries, praised the partnership as a pivotal step towards building a robust fisheries ecosystem for the future. With blockchain technology at its core, this collaboration is aiming to revolutionize Indonesia’s fisheries industry, fortifying its position as a global leader in responsible and efficient fish trade.ID Food, the corporate brand of the state-owned food giant PT Rajawali Nusantara Indonesia (Persero), boasts a diversified portfolio spanning agriculture, livestock, fisheries, and trade and logistics.Indonesia’s digital rupiahThis is not D3 Labs’ first Indonesian blockchain-related collaboration. In August, the Singaporean blockchain technology firm partnered with the Indonesian Blockchain Association with the objective of supporting the first phase of development of Indonesia’s digital rupiah.The initiative, titled Project Garuda, is being overseen by Bank Indonesia, the Southeast Asian country’s central bank. While cryptocurrency is not deemed to be legal tender in Indonesia and is not permitted for use when it comes to payments for goods and services, the Indonesian authorities permit trading of digital assets. In June, the Indonesian government published a document that set out a list of cryptocurrencies which are eligible for trading within the country.

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