Binance Issues Warning Over ‘Address Poisoning’ Crypto Scam

This crypto scam doesn’t need a hack to steal your funds, Binance warns.

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In a recent post, major crypto exchange Binance explains the address poisoning trap. Not every crypto scam is a hack, says Binance.

Address poisoning attacks rely on lookalike wallet addresses and human error. One copy-paste mistake can send funds to a scammer, and blockchain transactions are not reversible.

Not every crypto scam involves hacking.

Address poisoning attacks rely on lookalike wallet addresses and human error. A single copy-paste mistake can send funds to a scammer — and blockchain transactions can’t be reversed.

Learn how address poisoning works and how to protect…

Address poisoning is one of the more subtle scams in crypto, as the attacker doesn’t have to hack the victim’s wallet or steal the private keys. They simply wait for the victim to make a mistake when copying an address.

In this crypto wallet scam, the attackers send small transactions from fake addresses that look similar to addresses victims generally send to, hoping to confuse an unsuspecting user who copies the wrong address. Scammers can use automated tools to generate wallet addresses matching the first and last few characters of legitimate addresses, taking advantage of the way wallets display shortened addresses.

Funds sent to a poisoned address may be unrecoverable because blockchain transactions are irreversible.

Address poisoning attacks have been reported on many blockchains, including Ethereum, BNB Smart Chain, and others that use long hexadecimal addresses. Any blockchain where wallet addresses are long and often displayed in an abbreviated form is vulnerable.

In this kind of crypto scam, the attacker identifies a target wallet with recurring transactions in the past. The most frequent targets are active crypto users with larger balances. They generate a lookalike address that has the same start and end characters as an address to which the target regularly sends transactions. Then they send a small (usually zero-value or dust amount) transaction from the fake address to the target wallet, which gets added to the transaction history.

When the target wants to send funds again, they scroll through past transactions and copy what looks like the right address. If they pick the poisoned one, the funds go to the attacker.

To avoid address poisoning, only send to full addresses once you’ve verified them, use address book allowlists, and do small test transfers first.