Crypto exchange Binance is one of the trading platforms largest in the world, supporting billions of USD in trading volume every day. Co-founder and CEO Changpeng Zhao, commonly known as “CZ,” is one of the most prominent figures in the cryptocurrency industry. In a recent interview, CZ warned crypto investors to be cautious, especially when it comes to new project listings, as scams appear to be on the rise.
CZ highlighted the rise of Decentralized Exchanges (DEX), which makes more such scams possible. .“With so much money flowing into the cryptocurrency space right now, fraudsters see it as a huge opportunity. We do our best to screen projects and protect users, but in the end it’s up to the users to You have to do your own research,” he said.
According to CZ, one of the main ways scammers operate is through carpet-pulling scams involving new project listings and initial dex (IDO) offerings. In a sweepstakes scam, the developers behind a new cryptocurrency or token list it on an exchange under the false pretense of being a legitimate project. They promoted it heavily to drive up the price, then suddenly sold all their holdings and abandoned the project, leaving investors with worthless tokens.
CZ highlights the rise of decentralized exchanges (DEXs) that are enabling more of these scams. . “On DEX, projects are less thoroughly verified before being listed. This leads to more fraudulent projects being listed, driving up prices and then pulling the rug out from under investors.” easy way for scammers to make money,” he said.
Even on centralized exchanges that carry out due diligence like Binance, CZ warns that not all projects Fraud cases cannot be detected. “We tried our best but these scammers are very smart and determined. They fake documents, create complex websites and try their best to fool us. So users must Always be very careful,” he added.
Here are some tips provided by CZ to help investors avoid falling victim to listing scams:
Do independent research on any new project or token before investing. Don’t rely solely on marketing or hype.
Verify the project team and make sure they are real people with experience and public identities – not just creators anonymously.
Check the project website, white paper, and social media presence closely for any inconsistencies or red flags.
Please consider the long-term viability of the project’s business model or use case, not just the potential for short-term price increases.
Be wary of giveaway scams where projects that promise to double or triple a user’s funds simply by transferring tokens to a certain address.
Use a secure wallet to store coins and enable signing transactions to prevent hackers from stealing funds through phishing.
Only invest what you can afford to lose, as the risks are higher for new, unknown projects than for established crypto assets.
CZ concluded by emphasizing the need for thorough due diligence given the increasing risks. “There is still a lot of money to be made in cryptocurrency if you choose the right projects. But you need to be very selective and do your homework. Scammers are always coming up with new tricks, because So users should always be vigilant.” he say. As major exchanges work to strengthen their verification processes, individual investors must also learn how to identify and avoid potential listing scams to protect their funds in the volatile cryptocurrency market. high risk. Caution remains the key advice from industry leaders as adoption and innovation continue.