Crypto cybersecurity firm Trugard and onchain trust protocol Webacy have developed an artificial intelligence-based system for detecting crypto wallet address poisoning.

According to a May 21 announcement shared with Cointelegraph, the new tool is part of Webacy’s crypto decisioning tools and “leverages a supervised machine learning model trained on live transaction data in conjunction with onchain analytics, feature engineering and behavioral context.”

The new tool purportedly has a success score of 97%, tested across known attack cases. “Address poisoning is one of the most underreported yet costly scams in crypto, and it preys on the simplest assumption: That what you see is what you get,” said Webacy co-founder Maika Isogawa.

Address poisoning detection infographic. Source: Trugard and Webacy

Crypto address poisoning is a scam where attackers send small amounts of cryptocurrency from a wallet address that closely resembles a target’s real address, often with the same starting and ending characters. The goal is to trick the user into accidentally copying and reusing the attacker’s address in future transactions, resulting in lost funds.

The technique exploits how users often rely on partial address matching or clipboard history when sending crypto. A January 2025 study found that over 270 million poisoning attempts occurred on BNB Chain and Ethereum between July 1, 2022, and June 30, 2024. Of those, 6,000 attempts were successful, leading to losses over $83 million.

Related: What are address poisoning attacks in crypto and how to avoid them?

Web2 security in a Web3 world

Trugard chief technology officer Jeremiah O’Connor told Cointelegraph that the team brings deep cybersecurity expertise from the Web2 world, which they’ve been “applying to Web3 data since the early days of crypto.” The team is applying its experience with algorithmic feature engineering from traditional systems to Web3. He added:

“Most existing Web3 attack detection systems rely on static rules or basic transaction filtering. These methods often fall behind evolving attacker tactics, techniques, and procedures.“

The newly developed system instead leverages machine learning to create a system that learns and adapts to address poisoning attacks. O’Connor highlighted that what sets their system apart is “its emphasis on context and pattern recognition.” Isogawa explained that “AI can detect patterns often beyond the reach of human analysis.”

Related: Jameson Lopp sounds alarm on Bitcoin address poisoning attacks

The machine learning approach

O’Connor said Trugard generated synthetic training data for the AI to simulate various attack patterns. Then the model was trained through supervised learning, a type of machine learning where a model is trained on labeled data, including input variables and the correct output.

In such a setup, the goal is for the model to learn the relationship between inputs and outputs to predict the correct output for new, unseen inputs. Common examples include spam detection, image classification and price prediction.

O’Connor said the model is also updated by training it on new data as new strategies emerge. “To top it off, we’ve built a synthetic data generation layer that lets us continuously test the model against simulated poisoning scenarios,” he said. “This has proven incredibly effective in helping the model generalize and stay robust over time.“

Magazine: Crypto-Sec: Phishing scammer goes after Hedera users, address poisoner gets $70K

Hong Kong’s Legislative Council passed the Stablecoin Bill, paving the way for a regulated framework that could position the region as a global leader in digital assets and Web3 development.

In a May 21 post on X, Legislative Council member Johnny Ng Kit-Chong said the bill had passed its third reading, clearing the final hurdle for adoption.

“It is expected that by the end of this year, major institutions will be able to apply to the Hong Kong Monetary Authority to become licensed stablecoin issuers,” Ng said.

Image of the legislative assembly session. Source: Johnny Ng Kit-Chong

According to the new Hong Kong legislation, stablecoins must be backed by fiat currency as underlying assets. Ng said Hong Kong is welcoming “global enterprises and institutions interested in issuing stablecoins to apply in Hong Kong,” offering to personally assist with introductions and collaboration:

“I am also happy to facilitate connections and collaborate with all stakeholders to advance the development of Web3 in Asia and globally, with Hong Kong at the center.“

Related: Hong Kong introduces crypto staking rules, reaffirms Web3 commitment

Hong Kong aims to become a Web3 powerhouse

Ng said the legislation marks the first step on the road toward building Web3 infrastructure in Hong Kong. “The most crucial step is to develop more real-world applications.”

Ng said stablecoin adoption has the potential to drive innovation in retail payments, cross-border trade and peer-to-peer transactions.

He added that he encourages the development and adoption of stablecoins, since “they represent a major financial innovation.” Regarding enhancing market stability, Ng suggested distributing interest earnings to stablecoin holders.

Related: HashKey receives Hong Kong approval to offer crypto staking services

Interest for stablecoin holders

According to Ng, “providing interest will strengthen the competitiveness of stablecoins.” This increased competitiveness, he explained, incentivizes broader participation and expands stablecoin market share, which supports what he views as sustainable growth.

Ng’s remarks that yield-bearing stablecoins are more competitive follow recent positive data. Research indicates that yield-bearing stablecoins have soared to $11 billion in circulation, representing 4.5% of the total stablecoin market, a steep climb from just $1.5 billion and a 1% market share at the start of 2024.

Magazine: Crypto wanted to overthrow banks, now it’s becoming them in stablecoin fight

Guatemala’s largest bank, Banco Industrial, has integrated crypto infrastructure provider SukuPay into its mobile banking app, allowing locals to more easily receive remittances powered by blockchain technology. 

SukuPay’s infrastructure has been fully embedded inside the Zigi payment app, allowing Guatemalans to receive funds from the United States instantly for a $0.99 flat fee, the company disclosed on May 21. 

Users of the Zigi app do not need a crypto wallet or an International Bank Account Number (IBAN) to receive the funds, the company said. 

SukuPay CEO Yonathan Lapchik told Cointelegraph that the “key to mainstream adoption of blockchain technology is making it invisible to the end-user” so that there are no technical barriers. 

“That’s the only way we’ll scale blockchain to billions of people — by building the rails, not forcing people to learn how they work,” said Lapchik.

Established in 1968, Banco Industrial has more than 1,600 service locations throughout Guatemala. As of 2023, it had over 150 million Guatemalan quetzals in assets, equivalent to roughly $20 million US. SukuPay said its integration with Zigi marks one of the first crypto-native protocols to be used inside a major Latin American retail bank.

Banco Industrial has a long-term issuer default rating of BB. Source: Fitch Ratings

The bank also has operations in Honduras, Panama and El Salvador and is a key player in local remittance markets.

Related: Bitcoin treasury adoption grows in LATAM, mirroring US strategic BTC reserve plan

Remittances are lifelines for Latin America

Remittances, or money sent by migrants to their home countries, play a vital role in Guatemala and the broader region. 

The Inter-American Development Bank projected that remittances to Latin America and the Caribbean would total approximately $161 billion in 2024. Monthly remittances typically range from $131 to $648, representing between 6% and 23% of the sender’s average income.

“Remittances are lifelines in this region, but they’re broken,” Lapchik told Cointelegraph. 

“Guatemala alone sees $21 billion in remittances every year, and families are losing 6% to 10% of that to fees and delays. These are people sending $300, $400 a month, and they can’t afford to wait days or pay that much just to get money home,” he said, adding:

“Crypto solves this when it’s used the right way. It lets us move money instantly and at a fraction of the cost, integrated into the bank apps people already use.”

Latin America is the second-fastest growing region in terms of crypto adoption, though Guatemala lags behind regional leaders Argentina, Brazil, Mexico, Venezuela and Colombia, according to a 2024 Chainalysis study.

The study cited stablecoins as a primary adoption driver in the region. 

Crypto adoption in Latin America by total value received. Source: Chainalysis

Lapchik said stablecoins facilitate cross-border transactions more easily, but that “people don’t wake up saying, I need a stablecoin.’” 

“Stablecoins are just the best way to make that happen,” he said.

Magazine: Crypto wanted to overthrow banks, now it’s becoming them in stablecoin fight