CZ Urges Wallets to Block Scam Addresses After $50M USDT Loss

Binance co-founder Changpeng “CZ” Zhao is advocating for crypto wallets to implement automatic detection and blocking of address-poisoning scams. This comes after an investor mistakenly sent $50 million in USDT to a spoofed address.

Key Points on Address Poisoning Scams

Address poisoning involves attackers sending small amounts of crypto from addresses resembling those frequently interacted with by users, hoping victims will mistakenly send funds to them.
This scam exploits user habits, making it difficult to notice the slight differences in addresses.

A recent example involved a whale losing nearly $50 million in USDT by copying a misleading address from their transaction history. The stolen funds were quickly dispersed across multiple wallets using methods like Tornado Cash to hide traces.

Impact and Statistics

Binance's security team has identified approximately 15 million poisoned addresses using a specialized algorithm.
The incident coincides with a rise in phishing-related losses, with over $7.77 million lost among 6,344 victims in November alone.
According to CertiK, total crypto losses could reach $3.3 billion in 2025, with phishing being a significant contributor.

CZ's Recommendations for Wallets

Blacklist queries: Implement real-time checks against poisoned address lists and provide warnings before transactions are completed.
Spam/dust filtering: Filter out tiny transfers that clutter address histories.
Prominent warnings: Include safety prompts when copying addresses from transaction history or when addresses match known spoof patterns.

These measures aim to enhance wallet-side controls to counteract human errors, offering a solution without changing underlying protocols.