Blockaid Refutes Accusations of 'False Positives' in Crypto Drainer Shutdown

Blockaid's Web3 security platform announced that it has effectively driven at least one crypto drainer to close shop out of sheer frustration.

Moreover, Blockaid has rebutted accusations of an excessive number of "false positives," contending that achieving a zero false positive rate would inevitably leave room for certain malicious applications to exploit users' funds.

The provider also shared an image displaying what appears to be an announcement from a crypto drainer service previously utilised for illicit crypto acquisition.

Source: Blockaid's Blog Post

The announcement claimed:

"We have shut down because of Blockaid and the low hit-success rate."

This drainer team seemingly suggested that it is no longer profitable to target networks popular among Blockaid users.

The drainer team stated:

"I suggest draining on the Bitcoin network or maybe using a SOL drainer with the blowfish bypass."

However, it is worth noting that Blockaid's software is presently incompatible with the Solana and Bitcoin networks.

As part of a broader discussion on "false positives," instances where a security service erroneously identifies legitimate apps as malicious, Blockaid contributed to the conversation.

The team admitted that, on occasion, legitimate apps are mistakenly flagged, albeit asserting that this occurs in only 0.0002% of attempted transactions.

They argued against the pursuit of a zero false positive rate, contending that such a goal would necessitate allowing some malicious apps to evade detection and siphon users' funds.

It stated:

"The statistical nature of these systems means that we have to work towards striking a balance: having zero false positives inevitably means that malicious transactions will get through the defenses, resulting in easy to develop bypasses, and ultimately not disrupting the drainer economy."

Nevertheless, Blockaid expressed a commitment to further minimising false positives.

To facilitate this effort, they announced the launch of a new web portal enabling users and developers to report such errors promptly, with the aim of swiftly identifying and rectifying any false positives.

Who is Blockaid?

Blockaid is a pioneering developer of security software designed to identify potentially malicious smart contracts across Ethereum Virtual Machine (EVM) networks.

Its reach extends to prominent networks like Ethereum, BNB Chain, Polygon, Arbitrum, among others.

Integrated seamlessly into various wallets and applications such as MetaMask, Coinbase Wallet, OpenSea, Zerion, and more, Blockaid provides users with real-time warnings when attempting transactions with contracts flagged as malicious.

This proactive approach aims to safeguard users from potential fund drainage and enhance security across decentralised platforms.

What are "False Positives"?

"False positives" occur when a security system incorrectly identifies something as a threat when it is actually harmless.

In other words, it is like a security alarm going off when there is no real danger.

For example, if an antivirus program mistakenly flags a safe file as a virus, that is a false positive.

Similarly, in the context of cryptocurrency security, if a security tool wrongly identifies a legitimate transaction or smart contract as malicious, it is considered a false positive.

Violet is Just One of Many Drainers Encountered

Wallet drainers are financially driven individuals whose sole goal is profit.

When Blockaid implement effective measures to thwart their activities, they often relent.

Violet represents just one among several wallet drainers who have been compelled to suspend operations or cease entirely in recent months due to the increased difficulty the security platform introduced into their schemes.

Just a few days prior, Blockaid flagged out on X (previously known as Twitter) that Velvet Capital's been compromised, and that they have informed the team of the breach.

Shortly thereafter, Velvet Capital posted that the front-end will be closed for maintenance and for investigation.

It was much later in the day when Velvet Capital announced that the app is back up and running.

Not Always Accurate; Inaccurate Flagging

Just yesterday, the founder and CEO of XBorg, Lou, a player identity protocol that builds applications allowing players to create their player identity and use it to unlock new opportunities, rewards, and experiences tailored to who they are, prompted Blockaid that they their XGB presale had been flagged.

Blockaid had swiftly responded that the flagging was incorrect after completing a review.

However, it may take up to 12 hours for the modification of the flagging to fully take effect.

Unfortunately Lou announced that the flagging message will still show for 24 hours, asking the community to vote if they want to go live with a disclaimer or wait until tomorrow.

Over 70% of the community opted to wait.

A few hours thereafter, Lou confirmed that the presale will be postponed as voted.

He went on to summarise the attack that happened and apologise to the community for "the unpleasant experience."

His latest post 10 odd minutes ago was a defiant message proclaiming that today is the day they fight back.