Crypto press release distribution services have become a tool for questionable projects to evade third-party scrutiny and create an illusion of legitimacy, a new report from Chainstory shows.
Researchers reviewed 2,893 communications sent between June and November of last year. They found that more than 60% came from projects with “classic red flags,” such as an anonymous team making unrealistic claims, copy-and-paste websites, and aggressive tactics to scare investors into action. Some were outright scams confirmed as fraudulent by cross-referencing with blacklists and active scam alerts.
Unlike established traditional distribution services, crypto-focused news outlets often have agreements that guarantee placement on dozens of websites with little oversight. These paid placements often appear next to real news stories, sometimes without clear labels, making it difficult for readers to tell the difference.
“If you come across a cryptocurrency press release on a news site, the odds are better than 50/50 that the project behind it is low credibility (or worse),” the researchers wrote in the report published Tuesday.
Most of the launches were authored marketing announcements about minor product updates, token sales or exchange listings, the team said. Only about 2% reported significant news like venture funding or acquisitions, types of stories that would normally get editorial coverage.
CoinDesk reached out to several news wires, but none had responded by the time of publication.
Pay to show
At its heart is the relationship between distribution services and websites. The wires act as a channel, sending content for a fee, while websites charge to display them without editorial filtering, according to the report.
To the casual reader, it may appear to be coverage from reputable media outlets, although no journalists reported the story and the claims contained in the statement are unverified.
This tactic is not limited to startups. The researchers noted that major exchanges regularly publish press releases announcing each token listing to create a sense of constant activity. There is no suggestion that the exchanges are involved in irregularities.
The scattershot approach, however, increases visibility on search engines, clutters news feeds, and blurs the line between information and promotion, while giving otherwise unproven or high-risk projects a veneer of undeserved legitimacy.
“The core mechanism of the crypto press release industry is leverage,” the study says. “By funneling content through distribution networks, broadcasters avoid the ‘newsworthiness’ filter of a newsroom and instead rely on the credibility of the distribution platform.”
In one example from December, scammers used fake branding to impersonate Circle Internet (CRCL), the issuer of the USDC stablecoin. The statement promoted a fake tokenized metals platform and linked it to what appeared to be a wallet emptying site. CoinDesk debunked the launch, but only after it appeared on several news sites.
While some media outlets have begun labeling or limiting the content of press releases, the lack of clear standards and editorial filters remains a vulnerability in the crypto media ecosystem, according to the report.
