Binance Coin (BNB) Chain, a blockchain network created by cryptocurrency exchange Binance, has identified over 50 on-chain projects which carries a risk for its users, as stated by Cointelegraph.
According to Cointelegraph, a mixture of cryptocurrency spin-offs resembling Dogecoin (DOGE), Binance, among others, aimed at pandas, cyborgs, and koalas made it to the list of untrustworthy and high-risk projects. BNB Chain’s Red Alarm feature, created for the purpose to shield investors against potential rug pulls and scams, flags projects are based on the criterias such as if the contract performs differently from what the project owners advertised and if the contract shows risks that can have an effect users’ funds.
On the basis of data from Cointelegraph, as mentioned by Gwendolyn Regina, investment director, BNB Chain, the Red Alarm system went through 3,300 contracts in July. “The company continues to develop further measures for highlighting deceptive practices in the ecosystem,” she added. New projects which have not been tried and tested enough, are flagged on the grounds of scams, rug pulls and phishing. As a result, real-time identification of risky projects helps to protect investor funds. Red Alarm also allows users to assess project risks by entering the contract address to discover if it has got frauds or risks attached.
Moreover, information from Cointelegraph noted that Regina advised investors to conduct their separete research before engaging with projects within the BNB Chain ecosystem. Just like investors, well-intentioned projects are too considerable susceptible to attacks and scams. Trading and liquidity marketplace Velodrome Finance was able to recover $350,000 of lost funds, after being able to trace back the attack to one of its team members. While support was shown by many of the community members for the coder, Gabagool owned up the allegations made against him. Later, Velodrome unveiled that it sought the advice of a legal counsel to determine the next steps necessary.
(With insights from Cointelegraph)