A new security standard is proposed to prevent Man-In-The-Middle attacks, used by scammers in P2P crypto markets.
A Web3 developer known as Shadow Of Harbringer suggested the Zero-KYC Assurance Mechanism For Fiduciary Money Transfer (ZKAM-FMT) technology standard. According to the developer, it has the potential to completely eliminate the possibility of MITM attacks affecting users of P2P markets.
The peculiarity of the proposed security standard is the absence of the need to go through the process of user identification (KYC), which is an undesirable element for users of P2P markets, since one of the main priorities for them is privacy.
The author describes a typical MITM attack scenario using a fiat-to-crypto operation as an example:
- A crypto seller places an offer on a P2P marketplace to sell a digital asset in exchange for a certain amount of fiat.
- A scammer notices the order and creates a fake ad for selling an item, setting the price in fiat similar to the cryptocurrency seller’s request.
- A buyer contacts the scammer, who initiates the exchange order and sends the crypto seller’s data as payment details to the buyer.
- Once the funds are received by the cryptocurrency seller, they fulfill the order by sending tokens to the scammer.
- The scammer transfers the received cryptocurrency to another wallet and erases all traces of their activity.
The ZKAM-FMT standard proposes integrating a browser extension that can automatically verify transaction details, including the amount, sender name, and account number. The verification process is performed without storing user data or interacting with the banking system, ensuring secure transactions while maintaining a high level of privacy.
The concept still has several drawbacks related to updates and database access. Besides, the extension won’t enable control over transactions performed by applications.
Bitcoin Cash developers actively participate in the creation of the standard. All interested parties are invited to discuss and refine the proposed technology.
Using P2P markets is a common practice among crypto users. Last year, crypto exchange Bitfinex launched a P2P platform for users from several Latin American countries, allowing them to trade BTC and ETH, as well as stablecoins USDT, XAUT, and EURT.
