Blockchain security analysts are urging crypto exchanges to scrutinize deposits closely as malicious actors escalate efforts to flood them with fake tokens on the TON network.

Bad actors are intensifying attempts to exploit crypto exchange deposit systems. Scammers are exploiting fake USDT transactions on the Open Network (TON) as Tether expands its stablecoin support on the network. Data from blockchain security group Dilation Effect shows that malicious actors are spamming crypto exchanges with fake USDT transactions in large quantities.

According to on-chain activity reviewed by crypto analysts, at least one bad actor has been targeting multiple exchanges, including Binance, Bybit, MEXC, and Gate.io, with fraudulent tokens on TON. Blockchain researchers indicate that the hacker deployed a fake smart contract for USDT on TON, designed to mimic the metadata of the official smart contract.

While fake deposits are not a common occurrence in the industry, blockchain analysts had previously warned about this type of attack in 2023.

Analysts at blockchain firm SlowMist highlighted the unique characteristics of TON transactions, noting that almost all internal messages sent between smart contracts should be “bounceable.” This means if the target smart contract doesn’t exist or encounters an unhandled exception, the message will bounce back to the original account.

If an attacker transfers to an account without a deployed contract, setting ‘bounce,’ the deposited amount, after deducting the handling fee, will bounce back to the original account. The exchange sees a deposit record, but the deposited currency returns to the attacker’s account, SlowMist explained. The firm further noted that almost all blockchains face the problem of false deposits, and the TON blockchain is no exception.

While there are no indications that the recent activity has resulted in profit for bad actors, there have been instances where scammers succeeded in attacking trading platforms with fake tokens. A previous incident involved a contract upgrade for the GALA token, which created a loophole exploited by hackers. Following the upgrade, hackers tricked the deposit system of Coinhub, a Mongolian crypto exchange, with fake token deposits, successfully withdrawing all GALA from the exchange.

For more updates on the latest trends and news in the cryptocurrency world, continue exploring Global Crypto News.

Post Views: 10