Hackers and scammers are a real pain point for the crypto industry. Every day, innocent investors lose thousands of dollars to these miscreants, and the loot seems to be increasing with each passing year.
For instance, 2022 saw $4.3 billion in losses due to scammers and hackers. This represents a 37 percent increase as compared to the same figure from 2021. One of the main reasons for the success of these bad actors is their ever-expanding repertoire of exploits. It’s almost as if like they engineer some new scheme every day.
One exploit that seems to be doing the round these days involves impersonating popular crypto platforms and tricking users into investing in fake project/fraudulent schemes. Robinhood, Ripple and Binance have all faced such scams in the last week or so, resulting in heavy losses. Let’s take a look at these exploits and how they played out.
Robinhood’s Twitter hacked, used to promote fake coin
Robinhood is an online crypto and stock brokerage firm. It has been around for several years now and is quite popular across the market. However, on Wednesday, January 25, the trading platform was in the news for all the wrong reasons. Hackers were able to take control of Robinhood’s Twitter account and used it to promote a fake cryptocurrency, RBH.
“Reminder, we are launching our NEW TOKEN ($RBH) in the Binance Smart Chain. We will be live at 12 AM EST & you can be among the first to buy at a starting price of $0.0005,” said the now-deleted tweet, which also included a link to purchase the fake token on PancakeSwap, a popular decentralised exchange (DEX).
The same message was propagated across the rest of Robinhood’s social media platforms, including Facebook and Instagram. Combined, these platforms have more than 1.6 million followers. Therefore, it was only a matter of time before gullible investors bought into the scheme. Sure enough, BSC Scan reported that scammers were able to make off with 26.95 BNB tokens, worth around $8,200.
These kinds of exploits are not restricted to crypto exchanges. In 2020, hackers somehow gained access to the Twitter accounts of Joe Bidden and Barack Obama. They then created a fake donation drive and left a wallet address for interested parties to drop crypto funds. Of course, the miscreants disappeared after receiving the funds.
Ripple and Binance also suffer at the hands of scammers
In a similar kind of scam, hackers created websites that were almost identical to the Binance and Ripple web pages. They then used these websites to target Ripple investors with a fake XRP staking scheme, promising returns of up to 12 and 27 percent.
These fake schemes also created a sense of urgency by limiting the (fake) offer to the “first 10,000 investors.” Such lucrative rewards, combined with limited availability are enough to lure unsuspecting users.
Moreover, the websites were very close to the real deal. They had the same layout and font and even had links to actual blogs from Binance and Ripple. Ironically, some even had articles on crypto security and the benefits of using cold storage wallets. Further, Binance even has a DeFi XRP staking feature, which is part of the Binance Earn program. All this can easily confuse and convince users into handing out their funds to these bad actors.
How to stay safe from such scams?
Always double-check if the offer/website/email ID is legit. Visit the official website and social media handles to cross-check the details of any financial instrument/project being promoted. Stay away from schemes that seem too good to be true. Also, pay attention to website spellings; sometimes, scammers will use slightly misspelt URLs that often look like the real deal. Finally, it is important to remember that all these schemes leave the ball in your court. They depend on your misjudgment to be successful. This makes them easy to avoid, all you have to do is exercise due diligence.
