Crypto Investor Exposes Contract in Binance Projects

A significant debate broke out on X (previously Twitter) today as major Chinese crypto investor account holder @Phyrex_Ni posted a content stating that breaches of contracts in Web3 projects were alarmingly frequent – and especially those listed on Binance. The message, which was posted at 11:10 AM UTC, proceeds the viral post by @Bitwux about the loss of contractual integrity in the decentralized ecosystem.

Binance Web3 Projects

Phyrex, in his post, claimed to have invested in and incubated many crypto projects in the last one year and all of them have formal contract signing. However, he disclosed that nearly every project released on Binance will end up breaching such contracts. The problem reverberates throughout the Binance ecosystem. Chainalysis estimates that almost 15 percent of the new projects in 2025 have not resulted in unlocks as promised.

Contractual Spirit

Phyrex cries out that Web3 has no judicial regulation, which he refers to as slow and toothless. He observed that a single legal tussle involving a collapsed project had taken half a year to make very little headway. Analysts concur that even with the potential of blockchain in terms of transparency, smart contracts are not enforceable in conventional courts.

Law specialists at Sheppard Mullin and Project binance Syndicate verify that the lack of centralization in Web3 provides investors with minimal options when projects back out of deals. The informal reputation and community trust – the so-called contractual spirit as Phyrex terms it – is an important enforcement mechanism.

KOLs Treated as “Big Leeks”

The post by Phyrex also brings up the fact that KOLs (Key Opinion Leaders) are the ones that are exploited, typically a group of early investors and influencers. He states that although their assignments are minor (0.1%-1percent), project teams fail as well, and he sees them as just bigger leeks, ants with howitzer voices.

Phyrex continued that there used to be no avenue of complaints by victims in the past but with improved networking and resources, some investors have now started to organize collective action. According to reports, Dao arbitration, such as that of Arbitrum DAO, settled 15 percent more cases in 2025 than in 2024, through on-chain arbitration. Phyrex likened investing in Web3 to gambling, and he would always be ready to incur losses. CoinTelegraph continues by noting that currently only 20 per cent of Web3 projects perform any independent smart contract audit before launching, exposing most investors to untested and high-risk deals.