Crypto scams are rising as criminals wake up to the jackpots offered by individuals with a poor understanding of how to keep themselves secure online. In the latest case, police in Hamilton, Ontario, say that two teenage boys stole $4 million USD in cryptocurrency from an American man by impersonating the support staff of a major crypto exchange.
According to a CBC report, police say that the two young men used the internet aliases “Felon” and “Gaze” and tricked the man out of significant amounts of Bitcoin and Ethereum, the two most popular cryptocurrencies. The pair achieved this by impersonating the support team from Coinbase, the world’s second-largest crypto exchange.
“Spear Phishing” Attacks Target Specific Individuals
Such scams are so common there is a term for them. Spear phishing is a targeted form of cyber attack where attackers impersonate trusted individuals or organizations to deceive specific individuals.
The scam is distinct from ordinary “phishing,” which sends many malicious messages to many potential victims. Spear phishing is often more successful as it relies on bad actors knowing more about their victims.
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It is likely that the victim had a custodial account with Coinbase, meaning the exchange ultimately held access to his crypto funds. Complying with an authentic-looking email asking to share account details would be all that was needed to steal the victim’s funds.
Spear phishing scams like this one drive crypto users to choose non-custodial wallets due to security concerns. However, it is still crucial to remember that regardless of your wallet, you should never share your private keys.
The need for more interagency cooperation on this issue is clear. A police official, Krista-Lee Ernst, told the CBC that the local force had been working with US counterparts only since June 2023.
Over One-Third of Canadian Crypto Traders Hit by a Crypto Scam
The story comes only a month after BeInCrypto reported on the frightening levels of crypto crime in Canada. According to a recent survey, more than a third of Canadian crypto traders have been the victim of a scam.
Often targeting individuals is an easier win for criminals than hitting liquidity pools or cross-chain bridges. In these cases, fraudsters are able to exploit human weaknesses like trust and poor security knowledge.
Last week, BeInCrypto reported how one Boston man lost $300,000 in a “pig butchering” theft. A type of scam where the thief builds up a relationship with the victim before picking an opportune moment to strike.
However, the difference in the funds taken can be stark. Cross-chain bridge attacks, which exploit a mechanism that allows blockchains to communicate, can net hundreds of millions in a single exploit. Whereas normal traders rarely keep such sums in a single wallet.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content.
