Good day everyone,
I hope you are all well and had an excellent week, welcome to CryptoGod-1’s blog on all things crypto. In this post I will be looking at the damaging impact scams and wallet drainers had on the crypto industry during 2023.
Wallet Drainers in 2023
During 2023 some of the most popular crypto scams involved making use of phishing scams to steal from victims. This was noted in a recent publication by cryptocurrency security firm Scam Sniffers.
The report noted that these scams managed to drain almost $300 million from nearly 325,000 users throughout the year. These figures were increasing monthly as bad actors deployed more and more sophisticated techniques.
They analysed the market trends in the previous years and stressed the activities of bad actors during the growing asset prices and extensive regulatory activities. From their work, the report noted how wallet drainers deployed on phishing websites achieved some “level of success” when trying to trick users into signing big false transactions. This led to loss of assets and resulted in even more regulatory scrutiny in the markets. They noted how:
“Over the past year, phishing activities have steadily increased each month with phishing scammers employing more sophisticated tactics to evade security measures. Scam Sniffer has made findings on “Wallet Drainers” that warrant the industry’s full attention.”
Wallet drainers managed to scam wallet out of a record $295 million from 324,000 victims last year alone. A lot of this was accomplished by airdrops and hacking incidents. Most notably in March a large number of activity was linked to the price fluctuations of USD Circle. It was on March 11th when attacked saw a surge in excess of $6 million following the fluctuations in USDC rates as people interacted with fake USDC websites.
Many drainers did exit the market during the year but were often quickly replaced by new one. A typical example was when Inferno Drainer announced its exit only for Angel Drainer to enter the space. These drainers make use of new and existing techniques to gain traction such as paid Google and social media scams. This helps to divert users to their fake websites.
Fake airdrops were also noticed as a major form of fraud utilized by bad actors to gain community traction. They were made to seem like users were interacting with a protocol, when in-fact they were not. Other scams included the use of things such as Discord links and Twitter comment sections, while some straightforward hacking techniques involved compromising a platform’s official social media platform or simply attacking the project’s library.
“Although hacking attacks have a broad impact, the community often reacts promptly, typically within 10-50 minutes. However, airdrops, organic traffic, paid advertising, and taken-over Discord links are much less noticeable.”
While there have been numerous efforts and regulatory activities in the market, the scams are still find large success with their wallet drainers. They achieved massive returns from victims, with Inferno Drainer at the top of the list with $81 million stolen from 134,000 users.
Other notable drainers included MS Drainer and Angel Drainer, which took $59 million and $20 million from 63,000 and 30,000 respectively. Other large known drainers included Monkey, Venom, and Pink Drainer.
All-in-all the number of cryptocurrency scams witnessed has decreased compared with numbers from 2022. Back then the total figure was close to $4 billion lost in scams. The blockchain security firm Beosin has noted that the number of scams has reduced across all sectors of the industry, as September and November were recorded as the months with the most illicit activities.
Its been a difficult year in the crypto space for dealing with scams, as users suffered massive loses. However, with the figure decreasing from 2022, there is hope that it will lead to better days ahead. Users need to be aware heading into the 2024 Bitcoin halving and "hopefully" bull-run ahead that more and more of these scams will appear, especially when the market is booming.
Have a great day.
Peace. CryptoGod-1.
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