BNB Chain tops the crypto scams and vein pulls list: Research

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

On October 27, Solidus Labs announced the launch of a real-time on-chain threat intelligence tool. It has been described as a first of its kind approach to retrospective methods of dealing with crypto scams.

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

BNB chain has the highest

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 linked to scams, it reported. By comparison, 8% of all ERC-20 tokens were linked to scams in the Ethereum ecosystem, placing it in second place.

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

The BNB chain suffered massive losses earlier this month, resulting in a loss of around $100 million. The company has suspended the network that it is decentralized to prevent further losses. DeFiLlama reports that the BNB chain is the second largest in terms of total value, with a market share of $7 billion.

The scary stats didn’t just pertain to the BNB chain. Solidus reports that as of October 10, 2022, 188,525 smart contract scams have been found across 12 blockchains. Its threat intelligence tool claims that 15 scams are deployed on different networks every hour.

In addition, about $910 million in “scam-related ETH” has passed through centralized exchanges, it said.

Cathy Kraninger, vice president of Solidus Regulatory Affairs, said large rugs like the squid token made the news. However, he cautioned that:

“The full picture that stems from our data shows that most of these scams go unnoticed.”

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

Crypto scams are on the rise

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 remains the focus of the proliferation of crypto scams and search engines listing phishing websites such as Google only exacerbate the problems.

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