Ever since its introduction almost 10 years ago, Bitcoin has attracted the attention of investors and meme stock hoarders alike. Bitcoin (and other types of cryptocurrency) have become even more popular lately. Major causes for this is continued support from popular celebrities like Elon Musk and due to conversations online on social media sites like Reddit.
What are cryptocurrencies?
Cryptocurrency is a form of digital, decentralized currency that is not affiliated with any banks. They are based on the blockchain technology which involves keeping financial records in the form of a digital ledger which is distributed across the world. Due to this, the probability of cryptocurrency getting hacked is extremely low which makes them a very desirable form of payments. Several big Fortune 500 companies are currently looking into (or started) accepting payments in the form of bitcoin or other cryptocurrencies.
Using twitter and other social media
Even if cryptocurrencies are extremely difficult to hack, that doesn’t stop scammers to tap into the ongoing frenzy and lure people into ‘get rich quick’ schemes. Over the past two weeks, the fans of pop band have been bombarded with tweets
The above picture shows how some of these scammers try to entice public into a ‘giveaway’ type scheme. You would be surprised how many people still fall victim to such attempts.
Another even bigger example of scams using twitter was a very infamous twitter hack that involved scammers getting access to some administrative tools of Twitter admins so they could alter some high profile twitter handles themselves and post tweets for their bitcoin scam. They seemed to have used social engineering on Twitter employees to gain access to the above tools.
Crypto ponzi schemes
A ponzi scheme is a type of fraud that ropes in victims and creates the illusion of investment. It is a kind of pyramid scheme that is heavily based on referrals, and aims to constantly attract new investors.
Crypto ponzi schemes start by generating income by attracting new investors. They use the funds from new investors to pay out the old investors and keep the scheme up and running. Here’s how you can recognize a ponzi scheme:
- They offer promises that are too good to be true. Ponzi schemers usually try to entice their victims by claiming that they have a profitable deal. According to them, it carries virtually no risks at all.So, if it sounds too good to be true – it probably is.
- Frequent return on investment. Returns usually go hand in hand with the market condition. Be wary of investments if you are continuously getting good returns even if the market is down. They might just be trying to lure you into investing more money.
Along with cybersecurity infrastructure and expertise, phishing has evolved in the past decade too. Hackers are using all kinds of innovative techniques to try to lure people into giving them money. They can range from spear phishing attacks guaranteeing them money on their investments to phishing using Google Ads (like below)
Tapping into the Stock market frenzy
There has been a major upheaval of the stock market in the past couple of months due to the sudden increase in the value of ‘meme stocks‘. With bitcoin hitting its all-time high and more and more cryptocurrency popping up on the market, the race to getting rich is real. On top of that, certain celebrities and YouTubers hype up this phenomenon giving rise to the feeling of Fear of Missing Out (FOMO). This makes people want to believe in these scams and ultimately fall victims.
The above are just some of the examples of crypto scams doing rounds lately. Scammers, just like everyone else, keep evolving and their methods may change in the next year or so. But their MO stays the same. They tap into the fear of regular people OR create a sense of urgency. This helps their cause more than anything else.
When it comes to phishing and scams over social media, the general rule of thumb I follow is to be wary of any new investments. If it sounds too good to be true, it probably is and you should steer clear of it. The risk of losing it all is too big to justify any potential gains.
Never click on any ads that Google shows you and don’t forget to introduce as many precautionary measures as possible.