The Philippine National Police Anti-Cybercrime Group (PNP ACG) has sounded the alarm on the burgeoning world of blockchain gaming, cautioning citizens against the potential risks associated with this rapidly evolving sector. In an official statement released earlier this week, the PNP ACG highlighted concerns over the rise of extortion and scams within blockchain gaming, warning that it may pose a riskier proposition than investing in traditional cryptocurrencies.
The PNP ACG pointed to the emergence of “play-to-earn” models in mobile and online games, exemplified by popular platforms like Axie Infinity. These models allow players to earn rewards, primarily in the form of non-fungible tokens (NFTs), as they progress in the game or complete specific tasks. However, the police department underscored the dangers posed by cybercriminals who exploit unsuspecting players through deceptive practices.
Cybercriminals are exploiting the allure of gaming rewards, preying on users’ trust established through online conversations. Victims are lured into purchasing non-fungible tokens with the promise of substantial financial gains, only to find themselves falling victim to extortion schemesThe PNP ACG statement revealed.
Axie Infinity, a prominent player in the blockchain gaming arena, requires users to purchase a minimum of three NFTs, each costing as much as $100. The police department highlighted the stark contrast between the cost of entry into blockchain gaming and traditional gaming, raising concerns over accessibility and potential vulnerabilities.
“While blockchain technology offers innovative solutions, its gaming applications still expose users to scammers and market volatility. The security of the underlying blockchain does not guarantee the safety of its gaming components,” the statement cautioned.
As the gaming sector experiences rapid growth, concerns over regulatory compliance also come to the forefront. The PNP ACG highlighted the potential for non-compliance with Anti-Money Laundering (AML) regulations, which could attract bad actors seeking to exploit regulatory gaps on a global scale.
In response to these challenges, the PNP ACG offered a series of recommendations for gamers and investors. These included conducting thorough research before engaging in digital asset investments, utilizing legitimate exchanges and wallets, and being vigilant against potential scams.
The Department of Information and Communications Technology (DICT) recently announced a collaboration with the Blockchain Council of the Philippines (BCP) to promote the adoption of blockchain technology for societal problem-solving. The DICT Director, Emmy Lou Versoza-Delfin, hailed the technology’s potential for the public good, citing successful blockchain-based business solutions and innovative startups as harbingers of change.
In May 2023, the Philippine National Police had rescued 1,090 people from several Asian nations who were trafficked into the country. Notably, the authorities also discovered that these people had ties to cryptocurrency fraud.
According to sources, authorities and law enforcement organizations have recently been more concerned about cyber scams. According to reports, it has become a common practice to deceive or pressure victims of human trafficking into endorsing fraudulent cryptocurrency investments.
As the world of blockchain gaming continues to evolve, players and investors alike must remain cautious, navigating a landscape where innovation and risks intertwine. The PNP ACG’s warning serves as a reminder that while blockchain technology holds immense promise, it is crucial to exercise diligence and discernment in this dynamic realm.