Rising crypto scams lead to $2.3 billion in total losses in 2024

Share This Post

Cybersecurity company Kaspersky revealed that malicious actors have devised a new scam involving seed phrases to target unsuspecting crypto users, according to a Dec. 23 blog post.

This sophisticated scheme preys on individuals’ curiosity and dishonesty, leading to financial losses for unsuspecting victims.

How the scam works

Seed phrases, crucial for recovering access to crypto wallets, are manipulated by scammers who pose as inexperienced users seeking help online via social media platforms like YouTube.

These fraudsters post their fake seed phrases on these platforms to lure individuals into accessing seemingly valuable wallets. Upon accessing these wallets, users find large amounts of stablecoins like Tether’s USDT, creating the illusion of an easy profit.

However, withdrawing these funds requires gas fees, usually paid in Tron’s TRX. The wallet is intentionally left without sufficient TRX, prompting users to transfer their funds to complete the transaction.

Once these funds are sent, they are immediately redirected to a wallet controlled by the scammers.

Meanwhile, the central key to this scheme lies in the wallet configuration. The scammers establish it as a multi-signature wallet, which requires approvals from multiple parties for any transaction. This ensures that the USDT cannot be transferred out by the unsuspecting user even after they pay the gas fees.

$2 billion in losses

The seed phrase scheme is part of a broader wave of crypto scams that have surged in 2024.

According to blockchain security firm Cyvers, crypto-related fraud has resulted in losses exceeding $2.3 billion this year, marking a significant increase compared to previous years. However, it remains 37% below the over $3 billion recorded in 2022.

The firm noted that malicious actors employ different attack schemes, including access control breaches, which have emerged as the most significant threat, accounting for $1.9 billion in losses from 67 incidents. Smart contract exploits follow closely, with $456.3 million stolen across 98 attacks.

Meanwhile, Cyvers noted that pig butchering scams have become a dominant fraud tactic this year. In these scams, fraudsters build trust with victims over time, often through dating apps or text messaging, before convincing them to invest in fake crypto projects and ultimately stealing their funds.

The firm flagged over $3.6 billion in victim funds across more than 150,000 addresses and 800,000 transactions in 2024, highlighting the scale and sophistication of these scams.

The post Rising crypto scams lead to $2.3 billion in total losses in 2024 appeared first on CryptoSlate.

Read Entire Article
spot_img
- Advertisement -spot_img

Related Posts

Bitcoin Alert: Here’s Why The Trump Inauguration Is A ‘Buy The News’ Event

Bitcoin has fallen to a low of $92,508 on January 8 after previously hitting $102,357 on Monday, marking almost a 10% retreat in a matter of days The immediate catalyst appears to be the January 7

FV Bank Integrates Paypal’s PYUSD Stablecoin for Real-Time Transactions

FV Bank, a US-licensed digital bank, has announced the integration of Paypal USD (PYUSD), a stablecoin, into its banking platform This addition expands the bank’s stablecoin offerings,

Coinbase, Google, and ai16z members back new DAO to accelerate crypto and AI

Team members from Coinbase, Google, ai16z, and other major players have joined forces to launch Aiccelerate, a new Decentralized Autonomous Organization (DAO) that aims to accelerate the convergence

Ethereum Gets Massive $12,000 Price Tag From Research Lead Ahead Of Major Upgrade

DeFi protocol Derive’s Head of Research, Dr Sean Dawson, has provided a bullish prediction for the Ethereum price He predicted that the second-largest crypto could rally to as high as $12,000 and

Ethereum Price Lags Behind Lightchain AI Presale as the Testnet Launch Draws Near

PRESS RELEASE The battle for supremacy in the cryptocurrency market is often marked by innovation, bold ideas, and game-changing technology But if you’re keeping an eye on Ethereum’s

Gary Gensler Blasts Crypto Market On His Way Out

In an interview with David Gura on Bloomberg Markets on Wednesday, outgoing Securities and Exchange Commission (SEC) Chair Gary Gensler reviewed his tenure and the role of crypto within the US