Binance claims to have thwarted potential losses of over $2.4 billion In the first seven months of 2024, safeguarding more than 1.2 million users from scams and fraudulent activities. The exchange's risk management reportedly detected and blocked fraudulent activities that could have affected more than 1.2 million users.
Using AI to Detect Fraud
The leading exchange by trading volumes highlighted its internal risk management platform that utilizes artificial intelligence (AI) and manual review to monitor transactions in real time. This system dynamically detects suspicious activities across its ecosystem.
The most significant threat detected by Binance's system occurred during the crypto withdrawal stage. In 2024 alone, the crypto asset exchange flagged suspicious withdrawals totaling over $1.1 billion, representing approximately 45% of the total potential losses prevented.
Binance's approach to security is multilayered. It integrates numerous controls across its ecosystem to minimize risk exposure. According to the firm, the system oversees various aspects of the platform, including peer-to-peer trading, payments, and crypto network withdrawals, ensuring that users remain protected in every domain.
Real-time Monitoring
In addition to real-time monitoring, Binance employs a broad array of tools to protect users from scams. These include customized pop-up notifications, cooldown features, and wake-up calls. The platform also offers various channels for users to appeal and resolve issues if they are flagged as potentially at risk.
As of July 31, 2024, Binance had secured over $73 million in misplaced or lost funds for external parties. This achievement underscores the platform's ongoing efforts to create a safer environment for all crypto users.
Early this month, Binance disclosed that it had recovered a significant amount of lost funds and frozen ill-gotten gains that found their way onto the exchange . The exchange also mentioned that it is collaborating with industry peers and the public sector to support the affected users.
An estimated 80% of the recovered and frozen funds are linked to hacks, exploits, and thefts that occurred outside the Binance platform. The rest involves scams that also originated externally. However, this increase does not indicate a rise in criminal activity within the cryptocurrency space.
