The recently launched BNB Chain’s Red Alert system has identified and flagged 50 new crypto projects as potential scams or rug pulls. The list is dominated by projects inspired by pandas, cyborgs, and Smurfs.
Binance Flags 50 New Crypto Projects
In July, Binance launched the DappBay to discover new web3 projects. The DappBay was built with a Red Alarm, which screens the project in real-time to assess its risks based on existing features.
The Red Alarm has flagged over 50 new on-chain projects that pose a significant risk to users. The list of flagged projects is dominated by crypto spin-offs of the popular memecoin Dogecoin (DOGE) and Binance (BNB).
There are also other on-chain projects on the list that are inspired by pandas, dogs, koalas, cyborgs, and Smurfs.
The Binance Smart Chain Red Alarm
Red Alarm of the DappBay is a contract risk scanning tool launched on the BNB chain to assess the risk of screened projects based on existing features that have historically been present in scam crypto projects.
The system identifies risks based on two features. One, if the blockchain contract functions are different from what is advertised and two, if there are backdoors in the codes that can let the owners drain users’ funds.
Gwendolyn Regina, the investment director of BNB Chain, said that the Red Alarm system analyzed over 3,300 contracts in July. While the Red Alarm is a great tool, Binance has advised users to also do their own research to avoid falling into projects that evolve into scams after launch.
On the Flipside
- Binance was recently forced to delist APM after a probe by the U.S. Securities and Exchange Commission revealed the token to be a security.
Why You Should Care
The Red Alarm feature was designed to help users avoid scammers by warning them in real-time of potential risks associated with the projects.
Binance has also helped in recovering stolen funds, read:
Binance’s delisting of AMP is covered in: