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Feb 7, 2023 – Bondee, the latest social networking app, has come under fire for previous mentions of NFTs and a blockchain wallet in its privacy policy, which has since been removed. Popular among the youth of Southeast Asia, it has risen to the top of the download rankings. Backlash from current users stem from common misconceptions about blockchain technology, namely its perceived environmental impact and detriment of young, impressionable users. The largely negative reception towards crypto-gaming highlights the need for Web3 companies to educate consumers about this new technology.

Bondee Receives Backlash – What People Need to Know About Crypto-Gaming

Bondee is the latest social networking app that has taken the youth of Southeast Asia by storm. Launched by Singapore-based tech startup Metadream, the app has climbed the download rankings, sitting triumphantly at the number one spot in both the Apple App Store and Google Play Stores of Singapore, Malaysia, and Thailand.

The app allows users to interact with each other in a virtual space via customisable 3D-animated avatars. Its trendy design and similarity to  popular games such as Animal Crossing or Club Penguin are only part of why commentators have dubbed Bondee a ‘next-gen social app’. Its ability to connect users through virtual activities seems to be a massive draw for its primarily Gen Z user base.

However, the social networking phenomenon landed itself in some hot water recently over allegations that the privacy of users’ financial data was breached. Metadream has since denied these allegations. 

Metadream has declared that no financial information is currently collected upon the user’s download and registration. Bondee’s previous privacy policy contained a clause indicating its intention to integrate a blockchain wallet and NFTs. Since receiving backlash, however, the clause has been removed and the current privacy policy does not contain any mention of NFTs or cryptocurrency.

Bondee’s prior policy on crypto integration outlined how users would be able to create a public blockchain wallet where fiat currency could be exchanged for in-game currency (B-Beans), which could then be used to purchase NFT products within the app. 

This sparked dissent and controversy amongst current Bondee users. Current users have expressed their unwillingness to support crypto mining due to its perceived negative environmental impact. A Tweet that has received over 1,000 views states: “the reason why I don’t do Bondee: NFTs [are] not safe for the environment”. Netizens also voiced their intention to uninstall Bondee once the blockchain integration would be mobilized.

Amidst the maelstrom of users withdrawing their support for the app, there were also many who were confused. One Twitter user asks: “can someone please educate me about this whole Bondee NFT thing going on because I was having fun until [it] got complicated and I see that the app is related to NFT”.
So, what does a NFT and blockchain wallet mean, actually? And why are so many people against it?

Why gaming platforms are looking to integrate blockchain technology

Melding virtual currency with real-life monetary value is not a new concept. Millennials weighing in on Bondee have commented how the app’s previous plans for NFT integration is reminiscent of Habbo Hotel, a popular early 2000s massively multiplayer online (MMO) game where users paid fiat currency for in-game tokens. Habbo Hotel infamously became known as a hotbed for financial crime; authorities investigated hundreds of reported cases of virtual theft, where digital assets such as virtual furniture worth thousands of euros had been stolen. This arguably cast an ominous shadow over future endeavors to integrate virtual token systems with real-world currency. User reactions to another popular MMO Ni No Kuni’s integration of NFTs have been largely negative: the game had been ‘ruined’, according to multiple reviews. 

In-game assets such as cosmetic items, weapons, or furniture have always been sold on a gray market. A quick search on online secondhand marketplaces will churn up a plethora of gamers selling in-game assets for sale in fiat currency. Using traditional payment systems, many of these transactions carry the risk of fraud on both ends. Trading on third-party marketplaces also means that the game platforms do not see the profits from these transactions. Games integrating blockchain technology offer a solution to curb these issues of their predecessors. 

Crypto-games such as Meta Masters Guild and Fight Out – have been seen as the Web3 evolution of play to earn (P2E) gaming. This new wave of internet innovation is characterized by its incorporation of blockchain technologies and decentralized technology. This new technology uses a network of computers (nodes) that contain the shared history of every crypto transaction ever made. Each transaction submitted to this collection of data is subject to a validity check by the nodes. This affords the user the ability to complete secure, verified payments online without the need for a third party such as banks or credit card companies. With this, the digital assets are completely and securely owned by the user. Game developers also benefit from blockchain technology by keeping the trading of digital assets within the game platform. From this, the platforms would be able to earn revenue from the resale of in-game digital assets.

Despite theoretically benefitting both the game developers and users, crypto-gaming endeavors have consistently been met with criticism.

Cryptocurrency and the Environment

In a tweet that has garnered over 11,000 views, a Twitter user warns their followers about Bondee’s previous plans for blockchain wallet integration: “It’s not safe! They support NFT and aren’t good for our environment […] the party is kinda canceled.”

The narrative that crypto and NFTs are inherently detrimental to the environment is largely due to the energy-intensive nature of Bitcoin and certain other blockchain technologies, which are likely to contribute to an increase in global carbon emissions. The energy demand of the Bitcoin blockchain alone is estimated to be around 110 Terawatt Hours annually, comparable to the energy consumption of countries such as Malaysia and Sweden. However, this does not mean that all blockchain applications are detrimental to the environment; not all blockchains are created equal.

All blockchains utilize a consensus mechanism in order to maintain trustworthy records across many computers without the need of a centralized book-keeper. This system ensures that all the computers on a decentralized network are in sync and validates the transactions by checking digital signatures. The most well-known consensus system is proof-of-work (PoW), where users must solve complex problems before transactions can be added to the network. For this, high-powered computers generate random numbers on a trial and error basis; energy consumption for this can total up to more than that of a country with a large population. 

More recently and more commonly, Web3 companies are using a more environmentally friendly alternative to the proof-of-work mechanism: proof-of-stake (PoS). This consensus mechanism requires users to have their transactions validated by a random validator chosen by a weighted algorithm – no energy-draining supercomputers required.

If Bondee had followed through on its plans to integrate blockchain technology, it would have more than likely used the latter consensus mechanism, which would not have caused the catastrophic environmental destruction that netizens had been anxious about.

Are companies like Metadream preying on young users for financial gain?

Opponents of Bondee’s previous plans for blockchain integration have also cited concerns over the questionable ethics of integrating real-world money into a game aimed at a young, impressionable demographic. This tweet with almost 8,000 likes accuses Bondee of “taking advantage of the millennial/Gen Z dream of having affordable housing and just being able to dress up all day for them to be a whole NFT company”.

It is unsurprising that the Singaporean startup would make a clever foray into crypto-gaming. Despite the crypto winter in Europe, Singapore remains a powerhouse in fintech innovation. A gateway into digitizing the Asian market, Singapore offers decentralized finance (DeFi) companies the promise of growth and development, especially with government backing in the form of policies and incentive programs. With Bondee, Metadream taps into a promising crypto market – the youth of Singapore. A report from City A.M. in the last quarter of 2022 shows that 62% of Singaporean crypto investors were under 35. More recently, a 2023 survey by GoBankingRates Best Banks showed that more than a quarter of Gen Z respondents believe it is critical for their bank to have a cryptocurrency exchange or platform.

Bondee’s cute, fun, gameplay lures in young millennials and Gen Z users. This move addresses a critical point for Web3 companies looking to tap into the NFT market – ensuring consumers see actual value in the digital tokens. Critics of Porsche’s recent failed NFT collection cited the lack of perceived utility and value behind the tokens as a key player in the mint’s downfall. Through Bondee’s gameplay, Metadream immerses users in the metaverse (a virtual-reality space). Doing so allows users to develop a sense of value when it comes to digital assets and virtual belongings, which is imperative to the success of a NFT launch. For this reason, it makes sense why the company specifically targets younger, more impressionable users. Not only do the youth already have a persistent interest in crypto, but they are more likely to be influenced to develop a sense of value around digital assets.

The Future of Blockchain Gaming

Whether or not Metadream will continue their blockchain integration efforts remains unclear, but one thing is apparent: there is a lack of clear, reliable information about this burgeoning technology. The younger generation, especially, lack education about the possibilities blockchain technology affords. Misinformation and misrepresentation in the sensationalist age of social media has made navigating this new technology all the more confusing and frustrating; it is understandable that Gen Z and millennial users feel taken advantage of.

Companies need to improve communications with their user base. Change needs to happen gradually – current users have to be introduced to and become familiar with blockchain technology. The idea behind Bondee’s immersive gameplay as a method of warming users up to DeFi gaming may have been a good one. However, the mention of crypto being only in the fine print left a sour taste in users’ mouths – it perpetuates the stigma of crypto companies being part of a nefarious, predatory scheme.

Undoubtedly an ambitious and innovative move in the evolution of DeFi gaming, the success of Web3 companies’ attempts to get youth onboard the crypto and NFT train remains to be seen.

Be Alert Against Scams!

In the past decade, more and more people have become interested in cryptocurrency and the digital assets associated with it. While the virtual world has opened up a wide range of possibilities, it has also become a hotbed for scams. During the Christmas season of 2022, the NUS FinTech Lab experienced this firsthand, as cybercriminals used the FinTech Lab’s name and the NUS logo to create fake websites, social media accounts, and even mint tokens with the name “NUS FinTech Lab (NUS)”.

This article details the steps NUS FinTech Lab took to identify and counteract a fraudulent website and associated tokens, and how you can do the same if targeted with a similar attack.

Fake Tokens:

A group of scammers have created fake tokens on Binance Smart Chain and are promoting them through a fake Telegram account and website. They are using the NUS logo and a fake Twitter account with the handle @nus_lab and the name “NUS FinTech Lab” to promote it. 

To find out the token holders and other details, we searched for the token address on Binance’s Smart Chain (BSC) Scan. The token addresses and holders, as well as the quantity held, can be found under the “Holders” tab.

A few of the websites that have published the tokens are :

1.https://thebittimes.com/token-nus-BSC-0x9285d9a79cd1da8f1d5904ed38bbef5c82f4f587.html

2. https://recentcoin.com/token/nus-fintech-lab-nus-0x9285d9a7

3.https://cryptovotelist.com/newborn/0x9285d9a79cd1da8f1d5904ed38bbef5c82f4f587

4.https://top100token.com/address/0x9285d9a79cd1da8f1d5904ed38bbef5c82f4f587

5.https://coinsgem.com/token/0x00caaff31108014071eed798ccb9197684a2e6d3

Action/measure taken:

To protect members of the general public who may be duped into buying these fraudulent tokens, the NUS FinTech Lab team reached out to Binance using the Report/Flag Address option available on the token’s page on Binance. As a result, Binance has posted a warning message at the top of the token page.

Fake Website:

Fraudsters may use a tactic called impersonation scams to trick people into giving away their personal information for financial gain. They create websites that look very similar to official organizations, but the domain name may be slightly different. This makes it hard to tell the real from the fake.

In the case of the fraudulent NUS FinTech Lab token, the fraudsters have created a website (fintechlabnus.com) with a URL slightly different from the Lab’s official website (dev-fintech-nus.pantheonsite.io). Do not trust this website and be sure to double-check the URL before giving out any personal information.

To make sure you are visiting a legitimate website, double-check the URL of the website or contact the official organization. For example, if you’re looking for the official website of the NUS FinTech Lab, a quick Google search of “nus fintech lab” should return the website for our organization (dev-fintech-nus.pantheonsite.io). Websites created by fraudsters are often hastily created and shared with links on social media and email, so typically do not show up as the top result in a search engine.

The scammers’ fake website copied some content from the NUS Fintech Lab’s official website in an attempt to appear authentic, but there are several signs that this group is not affiliated with NUS. For instance, the contact information listed on the website is different from the official contact details of the NUS FinTech Lab.

Signs that a website might be a scam can include missing information about the team behind it, a whitepaper listed as coming soon but not actually available, and an unclear description of the token being offered. For example, if the token is described as a “Music NFT” but no explanation is given for what this means or what it is for, it could be a red flag. 

Additional clues that the website is fake can be found by querying the Whois database (e.g., https://whois.domaintools.com/). The fact that the domain was only created very recently (on 22 December 2022) should be another signal that the website may be suspicious. Using this information we were able to identify who was hosting this fraudulent website and contact the appropriate law enforcement authorities to take action. 

To ensure the safety of our data, we have conducted a thorough review of our own internal IT systems and can confirm that our systems have not been breached.

Scrutinizing the Marketing Channels:

Be wary of online crypto projects that seem too good to be true. Scammers have been known to use social media platforms to promote fake projects, so don’t be fooled. Before investing in any cryptocurrency, look into it carefully to make sure it is legitimate. The NUS Fintech Lab has identified cases of scammers impersonating them on Telegram and Twitter. 

1.  https://t.me/nusofficialchannel

2. https://twitter.com/nus_lab

These scams, known as Rug Pull Scams (see https://nftnow.com/guides/scams-explained-what-are-rug-pulls-and-are-they-a-crime/), involve the scammers creating a new token and hyping it up through marketing tactics then disappearing shortly after selling it. It’s important to stay vigilant and do your own research before investing.

The FinTech Lab was able to reach out to these platforms to block (and or flag) these false accounts, but always be vigilant of any suspicious activity.

Analyze the White Paper and Identify Team members

Before investing in any cryptocurrency, it is important to read the white paper, which outlines the development process. Fake cryptocurrencies often have poorly written and inaccurate white papers that do not explain how it works or how it is intended to be used. Reading the white paper can help you understand the protocols and blockchain of a cryptocurrency, and make sure it is legitimate.

White papers should always list the names of the people who created the cryptocurrency. You can usually find their coding, comments, and discussions on websites like GitHub or GitLab. Some projects use forums and chat apps like Discord to talk about the project. If you can’t find any of this information, it’s probably a scam.

In the case of the fraudsters impersonating the NUS FinTech Lab, the code behind their token is a copy of the sample smart contract code provided by Binance for token generation. Anyone can view the code by visiting the “Contract” tab on the Binance Smart Chain Scan website. Because no information about the team members is available, buyers should be wary of trusting the project.

The blockchain, cryptocurrencies and distributed apps (DApps) are exciting new technological developments with tremendous potential to create value for fintech.  However, due to the nascent nature of the technology and the lack of appropriate regulation to protect consumers, many fraudsters are taking advantage of the hype to scam consumers.  As it is so easy to create websites and social media accounts to impersonate legitimate players, it is important for you to be vigilant.  This article chronicles our recent experiences with a scam that attempted to impersonate our NUS FinTech Lab.  We hope that our experiences and the tools/techniques we used to identify the scam can also help you conduct sound due diligence when considering investing in cryptocurrencies.