Ripple and Binance Support TRM Labs’ Instant Crypto Crime Response System

In a groundbreaking announcement, TRM Labs, the blockchain intelligence organization that aids businesses and authorities in the fight against cryptocurrency-related crimes, has introduced Beacon Network, the first real-time response network for crypto fraud.

Real-Time Crypto Crime Detection

This initiative aims to stop illicit assets from leaving the blockchain and was developed in partnership with law enforcement, stablecoin providers, exchanges, and other entities. Founding members include Ripple, Binance, Stripe, Anchorage Digital, Zodia Custody, PayPal, Robinhood, and many others, creating a trailblazing alliance between conventional institutions and crypto enterprises.

Major federal law enforcement agencies globally are involved in the network, generating alerts and identifying critical threat-related addresses to prevent criminals from liquidating their stolen assets. Various security research organizations, including ZachXBT, zeroShadow, CryptoForensics Investigators, and Hypernative, contribute ongoing threat surveillance.

Data from TRM Labs indicates that at least $47 billion in cryptocurrency has been transferred to addresses linked to fraudulent activities since 2023. This figure is likely an understatement, as many victims of such crimes either fail to report them due to lack of knowledge or feel embarrassed about their situation. Furthermore, over $2 billion in crypto funds have been stolen from rightful owners this year alone.

This relentless surge of hacks, scams, and other illegal activities is siphoning billions from individuals, from casual investors to established organizations. Frequently, stolen funds are swiftly converted to fiat currency before law enforcement can intervene.

An illustrative case is the $1.5 billion Bybit hack that happened in February, where perpetrators conducted over 10,000 transactions in the aftermath, highlighting the urgent need for speedier responses and detection within the crypto space.

Operational Mechanism

Historically, law enforcement and crypto exchanges have been sluggish in responding to crimes, often only acting after funds have already been taken. Considering that blockchain transaction processing is usually quick, response times should ideally be measured in minutes rather than days.

The Beacon Network is set to combat the surge of crypto criminal activity by providing several essential functions:

• Address flagging and propagation: Investigators identify addresses associated with crimes, and the network automatically labels corresponding wallets.
• Real-time notifications: Alerts are triggered when tagged funds are received at a participant exchange or platform.
• Swift response: Crypto platforms will have the capability to freeze flagged deposits before withdrawals, effectively halting criminal activities.
• No-cost accessibility: Affiliate membership is free for law enforcement partners and verified exchanges.

“As the crypto industry continues to develop rapidly, threats like hacking and money laundering have become more sophisticated and complex.

It is no longer possible for a single team to combat these crimes effectively — we must collaborate as an industry to establish coordinated defenses and responses, and Beacon Network facilitates this.” – Heisen Guo, Chief Security Officer at HTX