{"id":17691,"date":"2024-10-11T11:40:31","date_gmt":"2024-10-11T08:40:31","guid":{"rendered":"https:\/\/forklog.com\/en\/ai-tools-exploit-kyc-loopholes-in-cryptocurrency-exchanges\/"},"modified":"2024-10-11T11:40:31","modified_gmt":"2024-10-11T08:40:31","slug":"ai-tools-exploit-kyc-loopholes-in-cryptocurrency-exchanges","status":"publish","type":"post","link":"https:\/\/u1f987.com\/en\/ai-tools-exploit-kyc-loopholes-in-cryptocurrency-exchanges\/","title":{"rendered":"AI Tools Exploit KYC Loopholes in Cryptocurrency Exchanges"},"content":{"rendered":"

Malefactors are employing AI-based software to circumvent stringent KYC<\/span> measures on cryptocurrency exchanges, according to a report by security firm Cato Networks<\/a>.<\/p>\n

The tool, named ProKYC, represents a “new level of sophistication” in crypto fraud. It marks a significant advancement over older methods used by cybercriminals to bypass two-factor authentication and KYC.<\/p>\n

Instead of purchasing fake IDs, fraudsters use AI-based tools to create entirely new documents and fake videos to pass facial recognition procedures.<\/p>\n

ProKYC is specifically designed to work with crypto exchanges and financial companies whose KYC protocols include matching a webcam image with a government document.\u00a0<\/p>\n

In the released video, a user integrates an AI-generated face into an Australian passport template. ProKYC then creates a video and photo of a person to bypass KYC on the Bybit exchange.\u00a0<\/p>\n

\"AI
Screenshot from a video demonstrating the KYC bypass procedure. Data: Cato Networks.<\/figcaption><\/figure>\n

Such tools enable malefactors to create new accounts on crypto exchanges, experts noted. ProKYC is available for $629 annually. It is also designed to work on payment platforms like Stripe and Revolut.<\/p>\n

Cato Networks’ Chief Security Strategist Itay Maor emphasized that detecting and defending against this new type of fraud is a complex task.\u00a0<\/p>\n

\n

“Creating overly restrictive biometric authentication systems can lead to numerous false positives. On the other hand, weak controls pave the way for fraud,” he noted.\u00a0<\/p>\n<\/blockquote>\n

Methods for detecting the use of AI tools exist. Some rely on humans manually identifying unusually high-quality images and videos, as well as inconsistencies in facial movements.\u00a0<\/p>\n

In June, Binance blocked<\/a> 297 “sybils” in the Megadrop programme. Some users had acquired “a large number of accounts with completed KYC to receive rewards in batches.”<\/p>\n","protected":false},"excerpt":{"rendered":"

Malefactors are employing AI-based software to circumvent stringent KYC measures on cryptocurrency exchanges, according to a report by security firm Cato Networks. The tool, named ProKYC, represents a “new level of sophistication” in crypto fraud. It marks a significant advancement over older methods used by cybercriminals to bypass two-factor authentication and KYC. Instead of purchasing […]<\/p>\n","protected":false},"author":1,"featured_media":17690,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"","news_style_id":"","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[1292,438,1246],"class_list":["post-17691","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-aml-kyc","tag-artificial-intelligence","tag-scammers"],"aioseo_notices":[],"amp_enabled":true,"views":"178","promo_type":"","layout_type":"","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/17691","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/comments?post=17691"}],"version-history":[{"count":0,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/17691\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media\/17690"}],"wp:attachment":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media?parent=17691"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/categories?post=17691"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/tags?post=17691"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}