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Firms pair up in fight against cryptocurrency fraud

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Two firms operating in the cryptocurrency sphere have joined forces to monitor the community as part of the ongoing fight against fraud.

AmaZix, which offers community manager services aimed specifically at crypto startups, will pair up with leading online intelligence provider BrandShield as part of the project. The two firms will trawl both social media and the wider internet in order to identify and take down fraudulent posts.

The project will make the most of BrandShield’s software, MyShield, which allows community members to report scams and fraud.

It is aimed at tackling the widespread problem of fraud in the cryptocurrency markets, which is a pressing issue. It is believed, for example, that almost USD $10m is lost every single day as a result of cryptocurrency scams, and that well over USD $1bn has been lost in 2018 to date in this way.

While some cases are clear examples of direct fraud, the ways in which the scams manifest themselves are diverse. They can also include hacks, for example, as well as techniques used in wider internet fraud cases such as phishing.

The CEOs of both firms were positive about the partnership and said that it represented a move towards increased security and vigilance.

“AmaZix prides itself on working as a partner to its crypto startup clients, working alongside the founding team to build a supportive community for the best crypto startups,” said Jonas Sevel Carlsberg from AmaZix.

“The community is nothing without trust, confidence, and the best security measures being put into place. BrandShield’s exceptional technology makes this a reality, not only for us, but do [sic] all of the clients that we support and represent,” he added.

And BrandShield’s CEO Yoav Keren said that the firm was looking to inject a dose of trust back into the blockchain universe. “The recent collaboration and multiplayer partnership with AmaZix is a major step towards creating a secure ecosystem for the blockchain world,” Keren told industry press.

“Scams are plaguing this industry, slowly stripping away layers of trust with the public. We want to instill a sense of confidence and security back into the space, and start with some of the biggest names in the industry.”

AmaZix, which is based in Hong Kong but has a fully distributed team, helps a range of clients manage their stakeholders during initial coin offerings (ICOs). It has previously worked with clients like Hdac and Bancor.

BrandShield, meanwhile, is based in New York and offers digital-focused reputation protection services.

The two companies are not the first to be responding to the ongoing threats posed by fraudulent crypto schemes, however. Earlier this year, for example, a major US state regulator said that fraud in this space was common and highly problematic. The Texas State Securities Board said that almost two-thirds of a group of cryptocurrency vehicles it investigated failed to give customers their location, which can make it much harder for law enforcement authorities to take action in the event that an instance of fraud is uncovered.