The proliferation of peer-to-peer (P2P) scams in Pakistan's banking system, particularly involving USDT transactions on platforms like Binance, has raised alarm bells. This deceitful scheme exploits the banking system's lax verification processes, causing financial harm to unsuspecting sellers.

The Scam Process

1. Buyers initiate a P2P transaction, agreeing to pay sellers in exchange for USDT.

2. After transferring payment to the seller's local bank account, buyers mark the transaction as complete on Binance.

3. Upon receiving USDT, buyers file false complaints with their banks, claiming mistaken payment.

4. Banks, without rigorous verification, freeze sellers' accounts or reverse transactions.

Impact on Sellers

1. Financial Loss: Sellers lose USDT and potentially fiat amounts received.

2. Trust Erosion: Legitimate traders become hesitant due to mistrust.

3. Account Risks: Sellers face scrutiny, potential account closure, and damaged financial reputation.

Challenges in the System

1. Lack of Verification: Banks fail to thoroughly verify claims.

2. Weak Consumer Protection: Sellers have limited recourse.

3. Slow Dispute Resolution: Lengthy processes exacerbate financial stress.

Possible Solutions

1. Enhanced Bank Verification: Stricter verification processes to prevent fraudulent activities.

2. Awareness Campaigns: Educating sellers to document transactions thoroughly.

3. Stronger Platform Policies: Collaboration between platforms like Binance and local banks to verify disputes.

The rise of P2P scams underscores the need for robust regulatory frameworks and cooperation between financial institutions and crypto platforms to safeguard users.

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