Telegram trading bots, which have been transforming the messaging platform into a quasi-crypto marketplace, are raising concerns among blockchain security firms due to significant security risks for users. These bots, which have existed for several years, have gained attention recently as the popularity of cryptocurrency markets has surged, as reported by CertiK, a blockchain security firm.
According to CoinGecko, the combined market capitalization of Telegram bot tokens is currently approaching $250 million. Among these tokens, Unibot is the largest, but other popular bots include Wagie Bot and Mizar. These automated programs function through Telegram and enable users to make trades on decentralized exchanges by sending messages through the app.
However, CertiK warned that many Telegram bots create crypto wallets for users, with only a few actually providing the private key. The storage of these wallets remains unclear, as they could be accessible by project employees, stored on the user’s device, or backed up through Telegram. CertiK emphasized that although these platforms offer high-volume decentralized exchange trading options, they should be considered extremely high-risk and unsuitable for storing assets in the medium to long term.
The Unibot token, currently valued at over $185 million, is the largest Telegram bot token by market capitalization. According to Dune Analytics, Unibot users have traded a volume of $155 million across more than 230,000 trades using the bot. The trading volumes of Unibot users have shown a spike since late May, indicating the growing popularity of these Telegram bots.
In an article published on August 5th, blockchain security firm Beosin also highlighted the security risks associated with using these bots. Beosin emphasized that the centralization of these bots poses a risk to a user’s private wallet keys. Additionally, the lack of open-sourcing and security audits from many of these bots also contributes to further security risks. Users could potentially lose control of their funds if their Telegram accounts are hacked.
To mitigate these risks, Beosin recommended that projects open-source their code to facilitate security reviews and ensure better storage of user private keys. This would enhance transparency and promote better security practices within the Telegram bot ecosystem.
In conclusion, while Telegram trading bots provide users with convenient access to decentralized exchanges, they present substantial security risks. As the market capitalization of these bots continues to grow, it is crucial for users to exercise caution and conduct thorough research before engaging with these platforms. Improved security practices and transparency within the industry would help mitigate these risks and protect users’ assets.
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