The $4.5 million crypto phishing attack incident

An unsuspecting crypto enthusiast recently lost a staggering $4.46 million in a sophisticated phishing scam. According to EtherScan, the victim transferred this amount in Tether (USDT) from their Kraken crypto exchange wallet to an address cryptically ending in “ACa7.” Blockchain security experts from PeckShield have identified this address as one associated with a phishing scammer.

Further investigations by Scam Sniffer, another blockchain scam monitoring platform, indicated that the stolen funds were directed towards an address linked to a “fake Coinone crypto mining exchange.” This revelation underscores the elaborate measures scammers employ to obfuscate their tracks.

A disturbing trend of rising USDT scams

Scam Sniffer’s data, presented on a user-created Dune Analytics dashboard, paints a grim picture of the current crypto landscape. Scammers have reportedly scammed crypto investors approximately $337.1 million in USDT, affecting a whopping 21,953 individuals. 

Crypto phishing data from dune analytics

Tayvano’s Dune Analytics dashboard on USDT Approval Scams. Source: Dune Analytics.

This alarming statistic suggests that these malicious actors might introduce more people to the crypto world only to defraud them later.

The mechanics behind approval mining scams

The Global Anti-Scam Organisation (GASO) has shed light on the modus operandi of these scams. Typically, victims are lured into a fraudulent mining pool where they’re asked to pay a network fee in Ether (ETH), ranging between $10 and $50. 

While this fee might seem legitimate, GASO warns it’s a ruse. Victims inadvertently grant scammers unlimited access to their wallets via the USDT smart contract by paying this fee.

This isn’t the crypto community’s first witnessed such a large-scale crypto phishing attack. On September 8, 2023, an unidentified individual lost a jaw-dropping $24 million from their Ethereum wallet. The stolen assets included 4,851 Rocket Pool ETH (rETH) and 9,579 Lido Staked ETH (stETH), valued at approximately $8.5 million and $15.6 million, respectively. Additionally, as AI becomes more mainstream, hackers are defrauding crypto users using AI scams rather unsuspectingly.

A call for enhanced security

In light of these events, authorities and crypto organizations emphasize the importance of robust security measures. As a crypto holder, we urge you to diligently safeguard your private keys and approach unsolicited offers or personal information requests skeptically.

As the crypto industry continues to grow, so does its attractiveness to malicious actors. This recent $4.5 million crypto phishing scam serves as a stark reminder of the importance of vigilance and the continuous need for education and awareness in the crypto space. To learn more about how to safeguard your crypto assets, kindly visit our education center.