You data is not safe on centralized exchanges

[Porfirii]

How do hackers know who to send messages to?

Hong Kong police warned users of the scam in an Oct. 9 post to its Facebook page dubbed “CyberDefender.”

“Recently, fraudsters posing as Binance sent text messages claiming that users must click the link in the message to verify their identity details before a deadline, otherwise their account would be deactivated.”

Is the message randomly sent to people? I think the hackers target Hong Kong Binance users and that can only be from data breach or insider work.

I am shocked reading this even though I know it is something that is common. Shouldn't these crypto exchanges be at the top of their game when it comes to the data of their uses. What I'm trying to say here is that if they notice that they have had a security breach they shouldn't wait for hackers to send these scam messages to their customers rather this centralised exchanges should reach out to their customers via any means informing them of a scam or a hack and that they shouldn't respond to any email or phone call that asked them to click on a link. This may seem hard to accomplish but it will be worse if their user base starts to decline because people no longer trust them.

Different laws in different countries obligue to warn users in case of severe security breaches. It is the case of Europe, but I'm not sure about Hong Kong. Take into account that admitting being victims of breaches has a cost for the reputation of the company too, so these situations have to be hard to manage, although from our perspective as users it is clear what is supposed to be done.

Maybe there is some sort of flexibility when it comes to declare a breach severe or light, they play with.

[1714761664]

1714761664

[Smartvirus]

How do hackers know who to send messages to?

Is the message randomly sent to people? I think the hackers target Hong Kong Binance users and that can only be from data breach or insider work.

I have always had a hard time believing that in any hack that happens to any exchange or project out there, there isn’t an insider work. I have great doubt in thinking otherwise. There is always going to be the hand of an insider so long as I’m concerned. This makes relieving staff or cutting down staff of there job in a critical position, as by some means to stabilize operation a dangerous thing. These guys knows the loopholes in the system and can explore it.
Also, not having to give your staff proper welfare, it’s some means to tempt them.

If it is someone like me, this is easily avoidable, but what if it gets to the hacker's selling peoples data to thieves and which can lead to physical robbery and attack.

It’s definitely one purpose by which, these bridged data’s can be used and one can not be too careful enough as some services are very much needed.

[Oneandpure]

I don't think problem with our data secure or not on centralized exchange, current have several exchange have been scam and required with KYC procedure but our data keep secure until right now. Last collapse decentralize exchange is FTX but never heard about any document of FTX user sell on dark market, its seems all user data secure although FTX have been scam almost one year and not any problem yet with user data publishing or selling on dark market.
All exchange have been hacked their target with stealing fund of exchange and hacker not focus with user KYC data because less of values, most priority how much fund for stealing than with how many user data of user have been KYC in some decentralized exchange market.

[Sophokles]

Exchanges are not the only place where you have shared your data. Your social media handle, website that you use for working purposes even your children's school database nothing is safe. If your identity is shaved somewhere on the internet then there will always be a chance for it to be misused. Centralized exchanges usually don't share your data with any third parties and the purpose of that data is to prevent you from any illegal activities with your account. I am not seeing anything bad about it.

[_act_]

Centralized exchanges usually don't share your data with any third parties and the purpose of that data is to prevent you from any illegal activities with your account. I am not seeing anything bad about it.

Are you sure? Are you to director of all exchanges in the world or are you spiritual enough to know that insider work can not lead to misuse of users identity documents? What about if the data is breached and stolen by scammers? With the KYC, there are still scam on centralized exchanges if you are not careful you will be scammed there.

[Wakate]

How do hackers know who to send messages to?

Hong Kong police warned users of the scam in an Oct. 9 post to its Facebook page dubbed “CyberDefender.”

“Recently, fraudsters posing as Binance sent text messages claiming that users must click the link in the message to verify their identity details before a deadline, otherwise their account would be deactivated.”

Is the message randomly sent to people? I think the hackers target Hong Kong Binance users and that can only be from data breach or insider work.

According to the post, the phishing scheme has seen 11 Hong Kong-based Binance customers report combined losses of more than $446,000 (3.5 million Hong Kong dollars) in the last two weeks.

If it is someone like me, this is easily avoidable, but what if it gets to the hacker's selling peoples data to thieves and which can lead to physical robbery and attack.

https://cointelegraph.com/news/hong-kong-binance-users-phishing-scam-jpex-crypto-scandal


Why KYC is extremely dangerous – and useless

It is actually true that having an account on a centralized exchange can pose some risk but because of that, it does not mean that we can create an account on centralized exchanges. Running businesses whether online or physical have their own risks so we just need to be very careful how we relate to information we get from our emails or dm.

 It is easy to get hacked through emails or personal dm than other ways. Our information can be leaked online if the exchange we are using got hacked and the team lose access to customers portfolio which is a big treat to many exchanges to be very careful how to keep their customers information. It is good when we choose the best exchange to use for crypto transactions whether trading or buying cryptocurrencies.

[goxcraft]

This is one of the major problems with centralized exchanges and KYC. They just won't provide enough security for customer data. And somehow, hackers always get that data. One way and another. It's nothing new. The most shocking thing is, not just data breaches sometimes exchanges themselves will sell out customers data. Not just low-time, low-value shitty exchanges, but exchanges like Coinbase, where they were caught red-handed selling customers data. Although I had to do my KYC many times due to my past gambling habit, but I am always against it.

The Coinbase Case: https://www.financemagnates.com/cryptocurrency/news/coinbase-admits-its-former-data-provider-sold-client-data/

[Coyster]

Exchanges are not the only place where you have shared your data. Your social media handle, website that you use for working purposes even your children's school database nothing is safe. If your identity is shaved somewhere on the internet then there will always be a chance for it to be misused.

Of course you have an ID card, your data is with your government and other institutions in your country, the government could also work with your bank to confiscate the fiat in your bank account, or get any information about you from centralized services you have used in your country. But that is the "centralized world", and i think that if you have interest in Bitcoin, you would want to want to keep that aspect of your financial life away from the government by not using crypto centralized services.

Centralized exchanges usually don't share your data with any third parties and the purpose of that data is to prevent you from any illegal activities with your account. I am not seeing anything bad about it.

They can share that data with any third party that has the legal right to request for it, whether you are wanted for any illegal activity or not.

[Davidvictorson]

Nobody should have any trust with centralized exchanges. Treat them with extreme caution knowing that your data and assets isn't safe with them. Even these exchanges know this and issued this out in their Terms of Service. Below is a snippet of a section of the Terms of Service from OKX , a centralised exchange.

4.7 By accepting the Terms, you expressly agree to the pooling of your Digital Assets with the Digital Assets of other users. Digital assets of users are not protected by deposit protection or deposit insurance scheme. In the case of an irreconcilable shortfall, you may not receive some or any of your deposited assets or funds.

Custody risk

6.36 OKX may hold Fiat Currencies and Digital Assets with third parties. However, the Digital Assets OKX holds are not “deposits” nor are they intended to be held as any other regulated product or service under Applicable Laws.

6.37 In certain circumstances permitted by the Applicable Laws and Regulations or market practice of the relevant jurisdiction OKX may register or record a User’s Account in the name of the custodian or under OKX’s name. If the Accounts are held in the name of the custodian or OKX’s name, such assets may not be segregated from OKX’s assets and, in the event of a default by the custodian or OKX, may not be as well protected from claims of the creditors of the custodian or OKX’s creditors as would be the case if the User’s client assets had been segregated from the assets of the custodian or OKX’s assets. For Users of OKX Singapore specifically, Users’ assets are held in one or more segregated custodial accounts on trust for the benefit of the Users.

6.38 In the event of the insolvency or any other analogous proceedings of a third party holding a User’s Fiat Currencies and/or Digital Assets, OKX may only have an unsecured claim against the third party on the behalf of a User and a User may be exposed to the risk that the Fiat Currencies, Digital Assets or any other property received by OKX from the third party is insufficient to satisfy the User’s claim and the claims of all other relevant Users.

6.39 If OKX deposits a User’s Fiat Currencies and/or Digital Assets with a third party, such Fiat Currencies and/or Digital Assets may be pooled with those belonging to other Users. In such circumstances, a User’s individual client entitlements may not be separately identifiable by separate certificates, other physical documents of title or equivalent electronic records and, in the event of an irreconcilable shortfall after OKX’s insolvency, any Users whose assets have been pooled may share in that shortfall in proportion to their original assets in the pool. Any entitlements or other benefits arising in respect of pooled assets will be allocated pro rata to each User whose assets are so pooled.

6.40 Fiat Currencies and/or Digital Assets may be held by a third party appointed in good faith by OKX, or by OKX’s nominees or sub-custodians. Such third parties are not under the control of OKX, and OKX accepts no liability for any default of any nature by such third parties and, in the event of any such default, a User may suffer total or partial loss in respect of the User’s Account. The extent to which a User may recover its Fiat Currencies and/or Digital Assets in jurisdictions may be governed by specific legislation or local rules.
https://www.okx.com/help/terms-of-service

The summary of it all is that, they will do with your personal information and digital assets as they please and there is nothing that you or anyone can do about it because they have already told you so. And you have inadvertently agreed to it when you registered on their platform.

[Juse14]

Also keep in mind that what has happened in several exchanges that experience destruction, in addition to leaking data also money is also not returned by them is very detrimental, although I understand that the leakage of data could be due to hacking activities, even if it is people's behavior In companies that do it yourself, it is a very bad action.

This is quite dangerous, thank you for reminding many people here, with this there might be an indication of a big fraud if you let it, tonight I will divert my funds to the wallet that is managed by myself.
But quite confused actually, for some beginners who learn to invest in Crypto, the first they recognize is a centralized exchange, so as to register and do KYC to be able to get the full features in the sale and purchase activity.

[Coyster]

But quite confused actually, for some beginners who learn to invest in Crypto, the first they recognize is a centralized exchange, so as to register and do KYC to be able to get the full features in the sale and purchase activity.

Do not be confused, even if you decide to use a centralized exchange, only use it whenever you want to convert crypto to fiat or vise versa, but do not use it to keep assets, your assets should be kept in your non-custodial wallet. I understand that it is very difficult for so many people to avoid using centralized exchanges for buying or selling crypto, but the best thing you can do for yourself is not to use it as a "bank", move your coins to Sparrow, Electrum or any other good non-custodial wallet.

[Distinctin]

This is the major problem of using a centralized exchange, because it opens room for scammers to disguise as the exchange to ask customers some personal information that they can use to have access to your funds.

I could remember that this trick is not new here in my country because this is how scammers will send you a text message or call you, that they are from your bank and that you should send them your last four digit number of your ATM card for them to verify your bank account to avoid blockage of ATM card. So many people fell for this trick, especially the ones that were not educated , and they got all the funds in their account wiped out.

This is the same method that these scammers has come with by deceiving people to verify their Binance account through the form so that they can have details which they can use to access your their Binance account.

It is better to stay away from CEX and if you can't, don't believe in whatever message or link that you get from anyone when it comes to your finance.

Centralized exchanges are somehow the playground of scammers. While safety and security is their utmost concern when it comes to centralized exchanges, but in reality scammers could always take advantage using centralized exchanges by sending you random messages so they will get an access to your account. By pretending that they were the legal team from a centralized exchange, some users opted to believe them without a doubt and give the details of their account without hesitation believing that it's part of using centralized exchanges and that they are supposed to provide the correct details for  the security of their account. While there are already few who can detect that is a scam, but still a lot of people still fall to this kind of trap not because they are not just educated but because they are just too trusting that once centralized exchange is involved, everything in it is valid and legit.

[SilverCryptoBullet]

Centralized exchanges are somehow the playground of scammers. While safety and security is their utmost concern when it comes to centralized exchanges, but in reality scammers could always take advantage using centralized exchanges by sending you random messages so they will get an access to your account.

It is discouraged to store cryptocurrency, money in centralized exchanges but I am sure with you, people will be less scammed by trading on centralized exchanges than on decentralized exchanges or Peer-to-Peer trading.

Because on centralized exchanges, you don't have pressure from your Peer-to-Peer trade partner to release your coin to finish a trade. Newbies can feel stressful with trade partner's pressure that is to force you to release your coin.

I agree that people lost big money on centralized exchanges by many exchange hacks and scam exits.

Reminder: do not keep your money in online accounts
Cryptocurrency exchange graveyard
Cryptocurrency exchange hacks