Cryptocurrency has emerged as an attractive option at a time when people are looking for alternate modes of investment that can be a hedge against inflation. It seems unlikely that the crypto wave will die anytime soon as more and more companies add crypto payment options to their services.
Its meteoric rise is such that it is well on its way to becoming a major disruptor of the world economy. Governments across the globe have taken notice of this phenomenon, and are in the process of coming up with regulations and policies.
Cryptocurrency and Scams
By virtue of its cryptographic nature, cryptocurrencies cannot be counterfeited, and each currency is unique and non-replicable. This also makes it virtually impossible to double-spend.
Cryptocurrencies’ latent characteristics have forced crypto scammers to come up with uniquely creative ways to dupe unsuspecting parties. Tricksters have been known to fool people into handing over cryptocurrencies and NFTs.
A report by blockchain data platform Chainalysis reveals that nearly $14 billion in cryptocurrency was sent to illicit addresses in 2021. This figure is nearly double of what was seen in 2020. The company confirmed that $2.2 billion was stolen in defiance of established norms and practices.
Initial coin offerings (ICOs), exit scams, rug pulls, and outright theft has become a common denominator in crypto trading.
One of the most rampant methods appears to be a rug pull. In a rug pull, crypto scammers promote new crypto tokens and manipulate investors into boosting liquidity and raising their value. It is a matter of grave concern that outright theft in crypto, in 2021, has grown at an alarming rate of 516 percent in comparison to the previous year.
The Amazon Token Theft
The latest trick used by hackers involves using the Amazon name for crypto tokens. Cybercriminals conducted a coordinated attack, leading people to believe and invest in a scheme called – Amazon to create its own digital token. It makes for an interesting study in psycho-social engineering.
Scammers played on people’s fear of missing out and forced their hands. They put up social media posts and articles that informed the reader about Amazon’s entry into crypto. After the reader visited the fake news site ‘CNBC Decoded’, they were automatically redirected to a website that was selling pre-sale tokens.
The readers were given roughly 30 seconds to absorb what was written before they were taken to the website. Here, they convinced the victims that it was a limited period of offer, and that the short supply is disproportional to rising demand. Visitors were duped into thinking it was a once-in-a-lifetime-opportunity and that they needed to act quickly. The fully functional website required people to sign up, confirm their email address and create a profile before proceeding with the transaction.
The tokens were available for purchase only through cryptocurrency. As the tokens were non-existent, the payments made by the victims ended by fattening the pockets of criminals. The hackers also listed a diabolical scheme of rewards, where customers would receive additional benefits if they referred family and friends.
Around 98 percent of the visitors were using mobile devices when they were taken to the fake token landing pages. Most of the victims are said to be from Asia and the Americas.
The scam was unearthed by cybersecurity researchers from Akamai Technologies, who reported their findings to Amazon. Later, an Amazon spokesperson informed ZDNet, “We take any attempts to misuse our brand seriously. We maintain a site to assist customers in identifying scams, including fake web pages.” Amazon also clarified that it never announced any plans to launch its own digital coin.
Safeguarding Your Digital Wallet
While law enforcement has increased its foothold in cryptocurrency, they have struggled to keep a check on dark market trades and scams.
Industry experts recommend doing your research before deciding to invest or trade in any new arena. In case of doubt, visit the company’s official website to confirm the news. Do not take any information at face value, and if it sounds too good to be true, it is most likely a scam. Using antivirus software, multi-factor authentication, and double-checking URLs are some of the ways in which you can safeguard your digital identity and wallets.
