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Coinbase slashes fraud response times with new AI-driven rules engine

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Coinbase slashes fraud response times with new AI-driven rules engine

Coinbase has rebuilt its anti‑fraud stack by tightly integrating machine learning models with a high‑speed rules engine, slashing response times to new scam patterns from days to hours just as TRM Labs warns crypto fraud is now a tens‑of‑billions‑per‑year, AI‑supercharged industry.

Coinbase has upgraded its anti-fraud stack by tightly integrating machine learning models with a rules engine, cutting its response time to new fraud patterns from several days to just a few hours as AI-enabled scams surge across the crypto sector.

The company describes a dual-track strategy where “models [are] responsible for long-term defense, rules [are] responsible for rapid response,” all housed in a unified framework that lets rules capture new fraud types which can then be fed back into models to strengthen overall defenses over time.

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Coinbase says it has turned what used to be a manual and slow rule creation workflow into a data-driven, automated recommendation system by restructuring data, automating schema evolution, and introducing notebook-based analytical tools for its risk teams.

Coinbase’s new fraud playbook

As part of the overhaul, the performance of rule backtesting has improved by more than 10 times, allowing Coinbase to trial and ship new protections far more quickly as scam behavior evolves in real time.

According to Coinbase, the system now uses machine learning to recommend rule parameters, with the goal of “reducing false positive rates while combating fraud and minimizing the impact on normal users,” an important balance for a major exchange processing billions in trading volume.

The latest upgrade builds on earlier efforts outlined in a Coinbase blog on advanced machine learning models, where the company said its mission is “to keep building scalable, adaptive, blockchain aware ML systems that enable Coinbase to effectively manage risk for its products” without degrading user experience.

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AI arms race against crypto fraud

The move comes as fraud in crypto has industrialized.

Blockchain intelligence firm TRM Labs reported that global crypto fraud reached about $35 billion in 2025, warning that when underreporting is included, “total annual losses likely exceed USD 200 billion worldwide”.

In a separate 2026 crime report, TRM said illicit crypto flows hit a record $158 billion in 2025, with scam networks increasingly run like professional businesses and AI tools accelerating impersonation and outreach at scale.

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Coinbase’s own chief information security officer, Philip Martin Lunglhofer, has previously said the exchange is seeing growing “AI-use cases to detect fraud” and is already using machine learning to monitor user activity and support chats for signs of scams or account takeovers.

The exchange’s latest investment in automated, event-driven rule generation and potential “one-click conversion” of efficient rules into model features is meant to push Coinbase closer to a fully automated risk management system, as fraudsters themselves weaponize AI to probe and exploit weaknesses faster than ever.

For broader context on Coinbase’s security posture and user protection efforts, readers can refer to Coinbase’s fraud-focused blog posts on machine learning and compliance, as well as prior coverage of Coinbase scam activity and crypto fraud trends on crypto.news.

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Morgan Stanley launches stablecoin offering through money market fund

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Morgan Stanley launches stablecoin offering through money market fund

Stablecoin issuers must invest a minimum of $10 million into Morgan Stanley’s money market fund, MSNXX, to access the stablecoin reserve offering.

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Paradigm-backed Succinct launches ZCAM iPhone app to verify real media

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Here’s why Morpho price rallied 12% today

Succinct Labs has launched ZCAM, an iPhone camera app built to verify photos and videos at the moment of capture. 

Summary

  • Succinct Labs launched ZCAM to verify iPhone photos and videos at the moment of capture.
  • The app creates cryptographic fingerprints that help prove media came from a real device.
  • ZCAM targets rising AI fake risks as fraud losses tied to generative AI continue growing.

The app uses cryptography to create a record linked to the device that captured the media.

The company said ZCAM “signs photos and videos at the moment of capture, producing a tamper-proof record that links content to the device that captured it.” The record allows users to check whether a file came from a real device and whether it was later changed or generated by AI.

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ZCAM targets AI fake photo and video risks

The launch comes as AI-generated images and videos continue to raise concerns around online fraud, identity abuse, and false media. Succinct said commercial AI detection tools can fail, so its system focuses on proving origin rather than only detecting fakes.

According to the company, ZCAM creates a cryptographic hash from the pixels captured by an iPhone camera. This hash works as a digital fingerprint for the photo or video and can support independent verification.

Succinct also cited Deloitte Center for Financial Services research that estimated generative AI could help push fraud losses in the United States to $40 billion by 2027. The figure compares with $12.3 billion in 2023.

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Adoption remains key for media verification

The app could serve businesses, journalists, and users who need proof that photos and videos are real. Media verification has become more important as AI tools make it easier to create realistic fake content.

However, broad use may depend on whether people choose to capture content inside ZCAM instead of their default phone camera. The product works best when users sign media at the original capture point.

Other projects have also used blockchain and cryptography to address AI-related trust issues. World, backed by OpenAI CEO Sam Altman, uses a human verification model to help separate real people from AI-driven online accounts.

Paradigm-backed Succinct expands crypto tools

Succinct Labs raised $55 million in a 2024 financing round led by Paradigm. The round also included support from founders linked to Polygon and EigenLayer.

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The company said its SP1 zero-knowledge virtual machine secures more than $4 billion in digital assets. In August, Succinct launched the mainnet for its Succinct Prover Network and activated the PROVE token.

The Succinct Prover Network runs as a decentralized marketplace on Ethereum. It lets applications submit zero-knowledge proof requests, while independent provers compete to verify them.

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$404K Polymarket Bet Triggers First CFTC Insider Trading Case Against US Army Soldier

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Brian Armstrong's Bold Prediction: AI Agents Will Soon Dominate Global Financial

TLDR:

  • CFTC accuses Army service member of Polymarket trades using classified Venezuela operation intel.
  • Over 436K event contract shares allegedly produced $404K profit via “Yes” Maduro position.
  • Case marks first CFTC insider trading enforcement tied specifically to prediction market contracts.
  • SDNY unsealed parallel indictment the same day, expanding civil and criminal pressure on defendant.

The Commodity Futures Trading Commission has filed a civil complaint against Gannon Ken Van Dyke in the Southern District of New York. The defendant, an active-duty U.S. Army service member, allegedly traded on Polymarket using classified operational information. 

Authorities say the activity involved an operation linked to the attempted capture of former Venezuelan President Nicolás Maduro. The case also runs alongside a parallel criminal indictment unsealed by federal prosecutors in New York.

CFTC Polymarket Insider Trading Case Involving U.S. Army Service Member

According to the CFTC complaint, Van Dyke participated in “Operation Absolute Resolve” between December 2025 and January 2026. 

The agency alleges he accessed classified and sensitive nonpublic information during operational planning. That information reportedly gave him insight into geopolitical outcomes tied to Maduro’s status.

Investigators claim he used that intelligence to trade on Polymarket prediction markets. 

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The activity centered on a contract asking whether Maduro would be out by January 31, 2026. Authorities say he purchased more than 436,000 “Yes” shares.

The complaint states Van Dyke operated under the handle “Burdensome-Mix” on Polymarket. 

His positions allegedly generated over $404,000 in trading profits. The CFTC argues this conduct violated duties of confidentiality owed by military personnel.

Besides, the regulator is now seeking restitution, disgorgement, civil penalties, trading bans, and a permanent injunction. The filing also marks a new enforcement angle for prediction markets linked to real-world events.

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Allegations, Enforcement Action, and Parallel SDNY Indictment

CFTC officials described the alleged conduct as misuse of sensitive government information in regulated markets

The agency emphasized that service members hold strict confidentiality obligations. It also linked the case to broader concerns about insider activity in prediction-based trading platforms.

Enforcement leadership said the defendant’s actions involved classified operational details tied to U.S. military planning. 

Authorities argue that such disclosures created market advantage in event contract trading. The case expands scrutiny of how nonpublic information intersects with decentralized betting markets.

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The CFTC noted this is its first enforcement action involving insider trading on event contracts. Officials also referenced the use of a regulatory approach informally known as the “Eddie Murphy Rule.” The agency said it intends to intensify monitoring of prediction markets.

Separately, the U.S. Attorney’s Office for the Southern District of New York unsealed a criminal indictment on April 23, 2026. 

Prosecutors allege similar conduct involving misuse of classified information and financial gain. The dual-track enforcement underscores coordinated civil and criminal action

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BTC ETFs pull $2 billion in 8 days while short-term holders sell

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(SoSoValue)

Somebody is buying $2.1 billion of bitcoin through ETFs. Somebody else is using that bid to get out.

U.S. spot bitcoin ETFs have now logged eight straight days of inflows totaling $2.10 billion through April 23, per SoSoValue. That is the longest streak since the nine-day October 2025 run that took bitcoin to its $126,000 all-time high. April 23 alone brought $223.21 million, with BlackRock’s IBIT doing roughly 75% of the lifting at $167.49 million and Fidelity’s FBTC the one meaningful outflow at $16.93 million.

(SoSoValue)

Bitcoin has climbed from $68,000 to $77,000 over the streak, a 12% move that has coincided almost perfectly with the ETF bid returning. Cumulative ETF net inflows since launch now sit at $58 billion, and total assets hit $102 billion, which is 6.5% of bitcoin’s market cap.

But here is the part the ETF data does not tell.

A Glassnode report from earlier this week showed that bitcoin just reclaimed its True Market Mean at $78,100, which tracks the average cost basis of actively transacted supply. That is the first time that level has been reclaimed since mid-January, and historically marks the transition from bear-market conditions to something more constructive.

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The problem is the next level. The Short-Term Holder Cost Basis sits at $80,100, which is the average entry price for anyone who bought in the last 155 days. A move above it would push more than 54% of recent buyers into profit.

In every prior instance this cycle, that threshold has coincided with local top formation as short-term holders use the rally to break even and exit. This is the second time the structure has set up, and it broke down the first time.

Short-term holder realized profit has already spiked to $4.4 million per hour, per Glassnode. The $1.5 million threshold has preceded every local top year-to-date. The current reading is three times that.

The setup from here is specific. Funding on bitcoin perpetuals is still negative, meaning shorts are paying longs. Saturday’s short squeeze took bitcoin to $78,000 briefly before the Hormuz reversal pulled it back.

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A second squeeze, stacked on the ETF bid and the spot demand Glassnode has flagged as recovering on offshore venues, is the clean path to $80,000. Whether that break holds against short-term holder distribution, or gets sold into the same way every local top has been sold this cycle, is the trade.

March’s seven-day streak broke the same week price tagged its local high. IBIT has carried most of the current run alone while smaller issuers posted mixed flows. The structure is not identical but the pattern rhymes.

The ETF bid is real. The exit liquidity for short-term holders it provides is also real. Which side wins at $80,000 is worth watching.

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Ethereum (ETH) Price Analysis: $633M in ETF Inflows Amid Continued Resistance at $2,400

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Ethereum (ETH) Price

Key Highlights

  • U.S. spot Ethereum ETFs have seen net inflows for 10 straight trading sessions, accumulating $633 million
  • Ether continues to face rejection at the $2,400 price level and has declined 22% so far in 2026
  • Nasdaq welcomed the BESO ETF from GSR Markets, marking the debut of a multi-crypto fund featuring staking rewards
  • Ethereum’s DApp-generated revenue has plunged to $13 million per week, representing a nearly 50% decline over half a year
  • Technical observers suggest $2,250 could serve as the next critical support if current resistance persists

Ethereum (ETH) is currently hovering near $2,340, consistently unable to sustain price action above the $2,400 threshold. While the asset experienced an uptick in tandem with Bitcoin’s push toward $79,000, the upward drive proved insufficient to pierce through major resistance zones.

Ethereum (ETH) Price
Ethereum (ETH) Price

U.S.-based spot Ethereum exchange-traded funds have recorded positive net flows for ten consecutive trading days through Wednesday, bringing total inflows to $633 million. Overall cumulative flows into these investment vehicles are now nearing the $12 billion mark. Within the current week alone, just three sessions contributed $206 million in net capital, representing the strongest weekly performance since these products debuted.

GSR Markets introduced the BESO ETF on the Nasdaq exchange this week, representing the first actively managed U.S. fund to hold a diversified portfolio of Bitcoin, Ethereum, and Solana while distributing staking yields. The product carries a 1% annual management fee, undergoes weekly rebalancing, and channels Ethereum staking returns of approximately 3.3–4.0% annually straight to investors.

BESO joins a competitive landscape that includes BlackRock’s IBIT, currently managing $54 billion in assets, and Bitwise’s BAVA, which provides AVAX exposure featuring 5.4% staking yields.

Transaction activity on the ETH network jumped 41% from the previous week as ETF-related engagement intensified. Additionally, the amount of ETH available on exchanges continues to contract as staking mechanisms remove tokens from circulation.

Declining DApp Revenue Creates Headwinds

Weekly revenue generated by decentralized applications on the Ethereum network has dropped to $13 million in April, marking a decline of nearly 50% compared to figures from six months prior. The wider DApp ecosystem has experienced similar pressures, with combined weekly blockchain DApp revenue across platforms falling to $73 million from $130 million recorded in October 2025.

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Competing networks including Solana, BNB Chain, and Hyperliquid have exhibited comparable downturns, indicating this represents an industry-wide phenomenon rather than challenges unique to Ethereum.

Year-to-date, ETH has fallen 22%, underperforming compared to the broader cryptocurrency market’s 14% decline. Nevertheless, Ethereum maintains its dominant position in total value locked (TVL), while its layer-2 scaling solutions have captured increasing market share in decentralized exchange trading volumes.

The annualized premium on ETH futures contracts has contracted to just 1%, significantly beneath the 4% baseline considered neutral. This reflects minimal appetite for leveraged long exposure, marking the weakest level observed over the past four months.

Technical Perspectives on Critical Price Zones

Crypto analyst Ali Charts highlighted that ETH is currently testing its Realized Price level at $2,340, which represents the average acquisition cost for all on-chain holders. Historical patterns suggest that when this level successfully holds as support, Ethereum has typically entered expansion cycles.

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Analyst Ted Pillows cautioned that ETH’s inability to reclaim $2,400 raises concerns and pinpointed $2,250 as the subsequent crucial support area. He emphasized that ETH appears to be exhibiting weakness compared to Bitcoin’s performance.

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Research from TD Cowen establishes a $3,650 price objective for ETH, while Standard Chartered maintains a longer-term institutional projection of $7,500 based on anticipated capital flows.

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The cryptocurrency Fear & Greed Index currently registers at 33, signaling fear sentiment among market participants, with 30-day price volatility measured at 5%.

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Polymarket Traders Profit $37K From Paris Weather Glitch

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Polymarket Traders Profit $37K From Paris Weather Glitch

Two Polymarket accounts have attracted suspicion after making $37,000 betting correctly on two unusual temperature readings of a weather station located in a major airport in France.

The two weather-focused prediction markets focused on the highest temperature in Paris on April 6 and 15, using the highest temperature recorded at the Charles de Gaulle Airport Station in degrees Celsius, according to Polymarket.

French media outlet BFMTV reported on Monday that the temperature suddenly climbed to over 21 degrees Celsius on April 6, before dropping again immediately. The market resolved with the winner taking over $16,000. The winning account is under 30 days old.

Meanwhile, blockchain analytics tool Bubblemaps reported a similar glitch for the April 15 market. The weather station showed 18 degrees Celsius most of the day, then suddenly spiked to 22 degrees Celsius before dropping back.

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Some have questioned whether foul play was involved. Prediction markets are already facing growing scrutiny over insider trading and possible violations of gambling laws.

Source: Bubble Maps

“That spike didn’t show on nearby stations,” Bubblemaps analysts said, adding that “Just before the spike, one trader started buying NO shares on 18°C,” before exiting with over $21,000.

The winning trader account has been highly active on Polymarket with wagers on crypto and weather. However, this is the largest payout by a wide margin; the next-highest is $13.

Ruben Hallali, a meteorologist, told BFMTV the temperature glitch was unlikely to be a natural event and alleged it may have been tampered with on-site.

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Related: Charles Schwab, Citadel Securities are eying prediction markets

“Such temperature variations seem very unlikely, especially on these two dates, and over such a short period. We can imagine that an individual with a good understanding of how the sensors work intervened, resulting in temperatures rising by two degrees at the right time, to validate a bet,” he added.

Météo France, the official government weather agency of France, has reportedly made a complaint with the police unit the Roissy Air Transport Gendarmerie Brigade, for alleged tampering with the operation of its automated data processing systems.

Magazine: How to fix suspected insider trading on Polymarket and Kalshi

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Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

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Crypto protocols pledge 43K ETH to restore rsETH backing

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Crypto protocols pledge 43K ETH to restore rsETH backing

Mantle, EtherFi Foundation, Golem Foundation, Lido DAO, Ethena, LayerZero, Ink Foundation and Tyrdo have all made pledges to the “DeFi United” recovery effort.

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US Crackdown on Southeast Asian Scam Centers Nets $700 Million Crypto Seizure

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Banks Broaden Lobbying Against Stablecoin Yield in CLARITY Act Talks

The US Department of Justice (DOJ) restrained more than $700 million in crypto and filed wire fraud conspiracy charges against two Chinese nationals who allegedly managed scam compounds.

US Attorney Jeanine Ferris Pirro, Assistant Attorney General A. Tysen Duva, and partners announced the coordinated actions alongside Treasury and State Department measures aimed at dismantling Southeast Asia’s compound-based fraud network.

Scam Center Strike Force Targets Burma Compound and Cambodia Expansion

The Scam Center Strike Force announced the enforcement push against transnational criminal groups accused of stealing billions from American victims. 

Huang Xingshan and Jiang Wen Jie allegedly managed the Shunda compound in Min Let Pan, Burma, between January and November 2025. They also use the aliases “Ah Zhe” and “Jiang Nan,” according to the press release.

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“According to the investigation, Huang served at Shunda as a high-level manager and enforcer and personally participated in the physical punishment of trafficked compound workers. Jiang served as a team leader directly supervising workers who specifically targeted American victims,” the authorities revealed.

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Prosecutors say one American victim lost more than $3 million to a worker managed by Jiang. The two defendants also tried to establish a second compound in Cambodia. Investigators seized 503 websites that hosted fraudulent investment platforms.

Authorities also took control of a Telegram channel with over 6,000 followers. The channel recruited victims into a Cambodia-based scheme that posed as law enforcement.

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FBI Co-Deputy Director Christopher G. Raia described the actions as a significant blow to transnational criminal organizations targeting American citizens.

“We have taken down more than 500 websites used to steal people’s savings. And my Office continues to work to identify funds stolen from victims, having now caused restraint of more than $700 million in cryptocurrency involved in money laundering from US victims of fraud. This Administration is lock-step in combatting these scams, and we are not done,” US Attorney Jeanine Pirro said.

In addition, the Treasury Department’s Office of Foreign Assets Control (OFAC) designated Kok An, a Cambodian senator accused of controlling scam compounds across the country. 

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REAL and RWA Inc. Expand RWA Infrastructure Ahead of Token Launch

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Brian Armstrong's Bold Prediction: AI Agents Will Soon Dominate Global Financial

TLDR:

  • REAL and RWA Inc. will explore tokenized asset issuance and investor onboarding infrastructure
  • The partnership includes post-issuance servicing, reporting, and asset distribution channels
  • AI-powered automation and co-marketing will support REAL’s upcoming token generation event
  • RWA market projections now point to a $16 trillion opportunity by 2030 across global finance

REAL, a Layer 1 blockchain focused on real-world assets, has entered a strategic partnership with RWA Inc. as tokenized finance continues to gain traction across crypto markets. The deal centers on asset issuance, investor access, and post-launch support for tokenized real-world assets on-chain. 

Both firms plan to use the partnership to strengthen infrastructure before REAL’s upcoming token generation event. The announcement comes as demand for compliant, yield-focused blockchain products continues to grow.

REAL and RWA Inc. Build RWA Infrastructure for Tokenized Assets

According to REAL’s official announcement on X, the partnership will explore how selected tokenized assets from RWA Inc. can launch on REAL’s blockchain.

The company said its Layer 1 network was built specifically for tokenization, trading, and management of real-world assets. That includes products like treasuries, gold, and private market assets.

RWA Inc. focuses on asset tokenization, investor onboarding, and Web3 growth systems. It also provides launch strategy, automation tools, and investor-facing infrastructure for projects entering the market.

REAL said both sides will work on distribution channels and lifecycle support after issuance. That includes reporting, servicing, and access management for investors holding tokenized assets.

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The firms also plan to develop AI-powered automation and campaign support around adoption efforts. Co-marketing activities will also support REAL’s upcoming TGE as the network prepares for broader rollout.

REAL added that future discussions may include agentic AI in governance, validation, and financial workflows. Both teams scheduled an X Spaces event for April 24 at 12 PM UTC to discuss the roadmap publicly.

RWA Market Growth Pushes More Blockchain Infrastructure Deals

The partnership arrives as real-world asset tokenization moves beyond early experimentation and into live financial infrastructure across crypto markets.

In a separate post, DeFi researcher The Angel said RWA is shifting from a market narrative into operating infrastructure. The post pointed to technology readiness, regulation, and institutional capital as the main drivers.

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The Angel highlighted jurisdictions like Hong Kong for creating clearer compliance paths for institutions. That reduces uncertainty and makes tokenized assets easier to deploy at scale.

Capital is also rotating toward stable, yield-generating assets instead of purely speculative crypto products. Tokenized U.S. Treasuries, tokenized gold, and pre-IPO equity were listed among the strongest demand areas.

The same post projected the RWA market could reach $16 trillion by 2030, representing nearly 10% of global GDP. It also noted that exchanges are seeing stronger monetization from asset-backed tokens.

Another growing area involves compute, energy, and AI-backed infrastructure linked to RWAs. This includes energy-backed compute and financial systems tied to physical assets.

REAL and RWA Inc.’s partnership reflects that broader shift as blockchain firms compete to become the settlement layer for tokenized finance.

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Army Soldier Used Classified Maduro Intel to Win Over $400,000 on Polymarket, DOJ Says

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Arbitrum Security Council Blocks KelpDAO Hacker From 30,766 ETH

The Department of Justice has charged a US Army soldier in a Polymarket insider trading case. 

He allegedly used classified intelligence to win roughly $409,881 by betting on the January capture of Venezuela’s Nicolás Maduro.

US Soldier Turned $33,000 Into $400,000 on Polymarket Using Classified Intel

According to a Justice Department indictment unsealed, Gannon Ken Van Dyke, a 38-year-old stationed at Fort Bragg, turned about $33,034 into approximately $410,000 across 13 prediction market bets before allegedly trying to erase his trail.

“Gannon Ken Van Dyke allegedly betrayed his fellow soldiers by utilizing classified information for his own financial gain. Van Dyke profited more than $400,000 by trading various outcomes related to Venezuela after learning of the operation because of his role as a US Army soldier,” FBI Assistant Director in Charge James C. Barnacle Jr said.

The US soldier was involved in planning and executing “Operation Absolute Resolve.” The early morning January 3 mission captured Maduro and his wife in Caracas. 

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Van Dyke, who reportedly used the Polymarket handle “Burdensome-Mix,” started placing Polymarket wagers on December 27, 2025, days before the operation went live.

All 13 bets took “YES” positions on Maduro and Venezuela-related contracts. They included “Maduro out by January 31” and “US Forces in Venezuela by January 31.”  The Commodity Futures Trading Commission (CFTC) said Van Dyke bought more than 436,000 “Yes” shares of the Maduro contract alone. 

After making a profit, Van Dyke allegedly moved most of the proceeds to a foreign crypto vault, changed his exchange email to an alias, and asked Polymarket to delete his account.

The US soldier faces five counts. They include three violations of the Commodity Exchange Act, as well as wire fraud and an unlawful monetary transaction. Each CEA count carries a maximum of 10 years, while each wire fraud count carries a maximum of 20 years.

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The CFTC has also filed a parallel complaint in the US District Court for the Southern District of New York. The agency is seeking restitution, trading bans, and civil penalties.

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Polymarket has faced mounting pressure this year over wallets making precisely timed bets on geopolitical events. Suspected insiders allegedly profited hundreds of thousands on contracts linked to the Iran conflict and the Maduro operation.

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The complaint breaks new ground for the CFTC, delivering both its first event-contract insider trading charge and its application of the “Eddie Murphy Rule” covering misused federal information.

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