Since ancient times, people have been earning money and looking for ways to multiply or preserve it. Among the many options offered by the financial world is cryptocurrency, also known as digital assets. Unfortunately, there is a significant number of fraudsters who are ready to use any tricks to take away everything you have earned.

The editorial office of 'Akchabar' increasingly receives messages from people who have lost varying amounts of their capital, becoming victims of fraudsters. Therefore, we spoke with the regional manager of Binance for Central and Eastern Europe, Central Asia, and Africa, Kirill Khomyakov, about the role cryptocurrency plays in our country and what methods can help protect against dishonest (and not only) money hunters.

Kirill Khomyakov is an experienced specialist in banking and fintech with over 15 years of experience. In 2022, he joined Binance, leading the Ukrainian market, where he successfully implemented global marketing strategies and established connections with government agencies. Since January 2023, Kirill has been overseeing the Central and Eastern European region, and since October 2023, he has also been responsible for the Balkans, the Baltics, and Central Asia. Previously, he held positions as the CEO of the State Agency for Infrastructure Projects of Ukraine and a software development company specializing in blockchain technology.

— What should users do to avoid falling into the trap of fraudsters?

— Fraudsters constantly develop their skills, just as our ways of protection do. Therefore, there are two aspects to consider. On one hand, it's what Binance does to protect users, and on the other hand, what users themselves should do to protect themselves and their information.

When it comes to user protection, we recommend several very important points:

• Use two-factor authentication (Google Authenticator, email, hardware keys such as YubiKey).
• Check the list of devices that have access to your account.
• Update the Binance app and software to the latest versions.
• Carefully check the transfer addresses to avoid changes in the payment details.
• Do not open suspicious links and files to avoid becoming a victim of phishing attacks.
• Stay updated with official Binance notifications sent via push notifications and email.
• Use secure internet connections and avoid entering personal information on suspicious websites.

— What steps are being taken to enhance transparency and trust in the cryptocurrency industry?

— In recent years, trust in the cryptocurrency market has been undermined due to the collapse of major exchanges like FTX and TerraLuna. These events have accelerated the process of regulating the industry. Cybersecurity also plays a crucial role: recently, the Bybit exchange suffered the largest hacking attack in history, losing 1.5 billion USD.

To restore trust, the industry must ensure transparency and collaborate with all stakeholders — users, regulators and law enforcement agencies. One of the key aspects is guaranteeing that exchanges do not use clients' funds for third-party purposes and that they are stored in the same assets in which they were deposited.

Our stock exchange was one of the first to implement the Proof of Reserves system, which allows users to track the status of all wallets and the asset coverage level in real-time. This mechanism confirms that the exchange has reserves exceeding 100% of user funds. According to the latest data, users have entrusted us with over 150 billion USD — more than the next ten stock exchanges combined.

Proof of Reserves is an important step towards transparency, and many platforms have started implementing this method, displaying their assets in real-time. This approach not only allows for tracking the exchange’s reserves but also takes into account the liabilities towards users, which enhances the level of trust and security of their funds.

— Do you see progress in the regulation of digital assets in Central Asia?

— Undoubtedly, there is an acceleration of these processes. This is one of the consequences of the negative events that have occurred in the industry. Regulators in all countries, including Central Asia, understand that they need to regulate cryptocurrency exchanges and protect their users from similar situations in the future. As a result, more and more Central Asian countries are starting to consider this, developing, and implementing regulations for their markets.

For example, Uzbekistan ranks 33rd in the global cryptocurrency adoption index. There has been significant growth here, with over 1.5% of the population using cryptocurrencies. Uzbekistan has had a regulatory framework in place for a long time, and more than 15 providers are licensed. This sector is growing very quickly. Kazakhstan is the second country in Central Asia where more than 1.5 million citizens are involved in the circulation of crypto assets (according to an analysis by RISE Research in collaboration with Freedom Horizons).

There is also Kyrgyzstan, which has already introduced its regulation. Despite being a small country in terms of population, over 100 licenses have been issued, and the official turnover has exceeded 4 billion. These three countries are the leaders in the region, and I know that other countries are either already working on regulation or plan to introduce it in the near future.

— How ready is Kyrgyzstan for the mass adoption of digital assets?

— Kyrgyzstan is showing significant growth in this direction. According to Triple A's research, the country had more than 115,000 cryptocurrency users in 2023. Officially registered stock exchanges and exchangers recorded a turnover of over $4 billion in the first half of 2023. This indicates the growing interest of the population in digital assets and their active usage.

— What key trends do you see in the development of cryptocurrencies in the country?

— The main areas of cryptocurrency usage remain similar to those in other countries in the region. Firstly, it is investment — people view digital assets as a way to increase capital. Secondly, transfers — cryptocurrencies are becoming a convenient and cheap alternative to bank transactions, operating 24/7 without restrictions. Thirdly, it serves as a means of storing assets, allowing users to preserve and move their capital without the limitations of the traditional financial system.

— What key recommendations can be given to beginner cryptocurrency investors?

— The cryptocurrency market is currently very volatile, and this is due to its relatively low liquidity compared to traditional markets such as Forex, stocks or gold. The cryptocurrency market is small, and any news or actions by regulators can significantly affect its dynamics. For example, tweets by the American president have caused major fluctuations in the market.

New users must understand that volatility is the main characteristic of this market. In order to make a profit rather than lose money, it is important to understand how it works.

Here are three key pieces of advice:

1. Education comes first. The more knowledge you have about how the market works, the features of coins, and how exchanges operate, the higher your chances of successful investing. We offer educational materials in various languages where you can learn about all aspects of crypto investing.
2. Invest wisely. The cryptocurrency market is highly volatile, so beginner investors should avoid investing large amounts right away. It's better to start with small investments and gradually grow your capital as you gain more experience.
3. Conduct your own analysis — DYOR (do your own research), one of the core principles of Binance, which we emphasize to our users. Don't rely on advice from bloggers or acquaintances. Study projects on your own: analyze the teams, read the whitepapers, check price dynamics, and assess community activity. This will help you avoid getting involved in questionable schemes.

— What is the main lesson that can be learned from cases of fraud involving fake tokens?

— You need to be cautious of schemes promising unrealistic rewards to stay safe. You should consider where the money is coming from to pay such high returns or enrich you so quickly. Investments should provide realistic returns. It is also important to always verify token addresses, for example, on CoinMarketCap or the official website of the token or its developers.

If an offer looks too good to be true, it probably is a scam. Fraudsters are becoming more professional and technically savvy. They often use a four-step process: find a victim, gain trust, persuade to commit fraud, and then disappear. Therefore, it is crucial to always verify information and stay alert to avoid falling victim to such schemes.