Possible Credit Card Fraud carried out on Splinterlands?
Several players of Splinterlands noticed shady market sales yesterday and we discussed them on Discord while watching huge amount of DECs getting dumped on the steem-engine market, resulting in huge drop in DEC prices.
What happen?
It was noticed that there were several peculiar purchases of single BCX cards at abnormal prices. The below is just one of the many sales by @makeyourhour to @juihui. A single BCX common card sold for $801.70 for more than 2 million DECs.
The DECs are then dumped onto steem-engine market and other TRX market, for Steem and TRX. The Steem are then swiftly cashed out via Binance and other exchanges.
How much?
According to some players' investigations, there could be more than 12 million DECs worth over $8000 made by this person.
How it works?
It seems like the person was buying Splinterlands Credits using a (possible stolen?) credit card. Splinterlands Credits can be bought via Paypal without any need for KYC.
The Credits were then used to buy cards from the game's market at crazy prices ($800 for a common card). The seller of the card (likely to be the same person) will receive DECs equivalent to the sales (8 million in this one purchase).
The DECs are then quickly dumped for other cryptos on various markets.
Very clearly, this person is trying to launder money. He does not seem to be worried about losing money (there is a 5% market fee by the game, selling DECs in such quantity crashes the market too) all he wants is to quickly cash the Splinterlands Credits purchased through his credit card. This had to be a credit card fraud.
Impact to Splinterlands
First, these activities are crashing the DEC market. The prices of DECs drop almost 50% overnight.
Second, although it is bringing in money to Splinterlands (through Credits purchase), but it is very likely that Paypal will chargeback these purchases soon. If the credit cards used are really stolen, a fraud investigation might arise and in the worst case, Paypal might suspend or ban the Splinterlands account.
I am not sure what the Splinterlands team is going to do about this. Looks like there isn't much they can do though. But if such activity continues, it is going to bring a bad name to the game.
Of course there are measures that the SM crew can adopt, and imo should adopt.
1st Cancel temporary the game's credit system. I know that this is though but is important to avoid this, could happen again.
2nd They should talk with a lawyer, if this is a crime and all the clues indicate it, they are concerned and should inform of what happened to the authorities. Colaboration with them means that this kind of behaviours aren't allowed in the game.
3rd Limit the card prices for types, for example 1$ for a common 5$ for a rare 10 for a epic and so on...
4rd Try to implement some measures to control the use of the Credits, and try to maintain the DEC price with some stability.
These are some measures that they could take, I'm sure that the staff will have ideas like these or better, but the issue is to take action and don't wait and see what happens. This attitude could be taken as some kind of acceptance with fraud, and crime.
Ty for the post @jrvacation, very interesting info.
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