Web3 Builders, together with OpenSea, announces $7 million in seed funding and the launch of TrustCheck, a free scam prevention tool for anyone transacting with crypto, smart contracts and NFTs.
Web3 Builders Inc. announced $7 million in seed funding from Road Capital, OpenSea Ventures and a group of VCs and cryptocurrency industry angels.
At the same time, the company launched TrustCheck, a free Web3 end-user security tool available to protect them from scams.
TrustCheck is a Chrome browser extension. The tool instantly and automatically analyzes the risk of a wide range of cryptographic transactions, including NFT transfers, smart contract interactions, authorization approvals, minting, purchases and token exchanges.
By simulating transactions before they happen, running checks on the company’s machine learning engine and analyzing data from more than a dozen sources, TrustCheck gives users personalized security recommendations in real time before finalizing a transaction.
In detail: comments from Pellegrini, Bailey and Fauvre on crypto scams
Ricky Pellegrini, CEO of Web3 Builders Inc. said:
“The release of TrustCheck as a free Chrome browser extension is part of Web3 Builders’ broader mission to make Web3 safe for all.
With a leading team of data scientists, machine learning specialists, and engineers, our company aims to fight industry fraud, scams and abuse with scalable, highly available tools. Beyond the datasets and real-time operations, which we continually mine for fraud and abuse schemes, we have personally interviewed hundreds of individual scam victims. This gives us a well-rounded view of the current state of both threats and end-user safeguards that are currently available.”
This round of funding will fuel the long-term development and expansion of Web3 Builders’ B2B enterprise product. It will also enable the addition of new artificial intelligence and machine learning methods, the growth of its operations team, and real-time scam collection.
Thomas Bailey, founding partner of Road Capital Management, states:
“It’s no secret that Web3 transactions can be risky. This is a major barrier to entry for otherwise interested attendees and the launch of TrustCheck is a significant step towards building the trust and security that users deserve.”
Road Capital was joined by OpenSea Ventures, Sparkle Ventures, Picus Capital, ACME, TTV, G20, Global Founders Capital, Haven Ventures, and Greylock in a planned $5 million Seed round. Which later grew to $7 million.
Anne Fauvre, formal advisor to the company and VP of Ops, Marketplace and Integrity at OpenSea, said:
“OpenSea Ventures is excited to support Web3 Builders, a company whose priorities are closely aligned with ours: to help make web3 a much safer space for consumers.”
We are excited about their innovative approach to fighting fraud, scams and abuse in the industry and look forward to seeing how their contributions improve the health and safety of the ecosystem.”
TrustCheck leverages data from more than a dozen sources covering tens of thousands (and growing) of reported and validated scams and hundreds of millions of addresses.
These feed into a simple and easy-to-use “zero-click” product interface. Which does not require a wallet connection or account creation and protects users from the most common scams.
Anyone interested can download TrustCheck on the website and learn more about the team, mission, and Web3 Builders’ unique approach to making Web3 safe for everyone.
With a team of builders from places like Harvard, MIT, Coinbase, Oracle and AWS and a history of working in public safety, the company is committed to creating tools that keep end users safe. It also offers B2C and B2B software solutions.
Crypto scams: how many and which ones are most common
Unfortunately, the data on cryptocurrency scams represent worrying numbers. In fact, about 7,000 people lost more than $80 million in cryptocurrency scams from October 2020 to March 2021, according to the Federal Trade Commission (FTC).
These figures are even more alarming when compared to the 570 cryptocurrency investment scams and $7.5 million in losses during the same months of the previous year.
Fraud in the crypto world is facilitated by the fact that it is currently not protected by European financial services legislation.
Moreover, the situation becomes even more complicated when one considers the laws enacted, for example, in Switzerland and Malta in 2018 or Liechtenstein in 2020. Laws that, unfortunately, have only further confused the market.
Many of the crypto scams that have occurred recently have occurred under the false name of Elon Musk. In this type of crypto fraud, the fame and notoriety of the celebrity figure is exploited to capture the trust of users and also to distract them from anything that might not be clear and/or guaranteed.
Fraudsters, in these cases, steal images to lend credibility to their ploys and sometimes even manage to hack the verified accounts of well-known people in such a way as to be believed. Unfortunately, in these affairs, Elon Musk, the founder of Tesla and SpaceX, represents the perfect ‘ambassador’. In fact, there have been many scams that have occurred under his name.
The most recent events
For example, one of the most recent occurred to Mr. Tim Dodd. The man created the YouTube channel Everyday Astronaut and had been given the opportunity to film SpaceX‘s rocket facilities in Texas with CEO Elon Musk by uploading it to his channel.
However, as he clicked on what he thought was a YouTube livestream of SpaceX’s historic Inspiration4 launch from Kennedy Space Center, what appeared on his screen was nothing more than his video with Elon Musk copied to create fake livestreams of the launch.
The scammers, Dodd says, were trying to trick people into donating Bitcoin on another website.
In March last year, a man in Germany was duped by a Bitcoin giveaway scam tweeted by a fake Musk account. The tweet asked people to send any amount from 0.1 to 20 BTC and Musk’s team would send back double the amount.
To lend credibility to his offers, the scammer had created a fake account that appeared to belong to Musk by using it to respond to a real tweet from the Tesla CEO. The scammer copied Musk’s profile photo and used a verified Twitter account.
Another curious crypto scam occurred to fans of Squid Game, a well-known TV series aired on Netflix. The token, i.e., the unofficial virtual token called Squid, collapsed to zero dollars after rumors and signs emerged on social that it might be an alleged scam. At its peak, the Squid crypto token had been valued at $2,856.
The cryptocurrency’s social media accounts, including Twitter, disappeared. So did the cryptocurrency’s website and its white book, which detailed the cryptocurrency.
The social media giant had previously said it had temporarily restricted Squid’s account due to “suspicious activity.”
The cryptocurrency’s growth had skyrocketed a week after its launch. But those who invested in the Squid token have now lost potentially millions.
Meanwhile, developers have apparently made $3.3 million through this type of fraud called “rug pull.” This scam occurs when the developers of a project, like the Squid token in this case, abandon it and pocket the investors’ money.
Once a significant number of investors trade their Ethereum for the token, the creators of the asset remove the liquidity, causing the value of the coin to drop to zero.