how to protect assets from frau …

how to protect assets from frau …

With the development of the popularity of cryptocurrencies, the number of scammers who are trying to make money in this area in a dishonest way also increases. Recently, users of cryptocurrency wallets have faced a new type of asset theft – through fake cryptocurrencies, copying real-life tokens.

What is this scheme, why anyone can become its victim and how to protect yourself – read in this material.

How they work with fake tokens

The standard scheme looks like this – little-known tokens suddenly appear on your cryptocurrency account:

  • FLUX and VELO – fake copies of real tokens;
  • MNEB is a phishing token that steals data from a person’s wallet;

and for a large amount – several thousand, or even millions of dollars. However, you cannot exchange them inside the wallet – when you try to do this, you will either see a link with a proposal to go to the site of a fake copy of a real project, where you can “unlock” these tokens or your wallet, or you yourself have to google to go to scam sites. To exchange for them, you need to log in and pay a commission according to the protocol – for example, if transactions take place on the Binance exchange network, then from 0.3 to 0.9 internal BNB tokens ($ 100 – $ 400). The operation looks very profitable in relation to the amount of the drop that fell to the account from nowhere, but after performing it, you will not receive the promised exchange. Moreover: in most cases, not only commission, but also all available assets will be debited from your account. And you won’t be able to return them.

FLUX: A Fresh Example of Cryptocurrency Fraud

One of the latest cases of mass theft of cryptocurrency assets fell on users of the MetaMask wallet, which integrates into the user’s browser and cooperates with the Binance exchange. On the channel Shitcoin Detective on YouTube On July 31, an overview of this situation appeared – we will tell you just about it, you can watch the full video by following the link on the channel name (it is in English).

So, in July, several people saw 950K FLUX tokens falling out of nowhere on their MetaMask account. As it turned out later, they appeared as a drop from the GoFlux dot io site, which we will talk about in more detail in the next subsection.

So, the wallet showed them the possibility of exchanging this amount for BNB at the rate of 44.9 – at that time 1 FLUX on the market cost $ 0.10, and 1 BNB – about $ 300, so the offer looked super-profitable.

This is how the offer for the exchange of fake FLUX tokens in the MetaMask wallet looks like.

However, when Shitcoin Detective went to check the information on the deal, it found several interesting things.

Firstly, in the description of the conversion deal and on the sites offering the exchange of FLUX for BNB, there was no information that FLUX exists on the Ethereum network, that is, it cannot be converted to BNB, which operates on the Binance Smart Chain network. This means that it can only be sold.

Secondly, according to the tracking site BscScan, the sum of all FLUX tokens at the end of July 2021 was 100M, with 99.8% held by one person, but more than 10 people owned 950K FLUX or 0.95%. Even 10 times at 0.95% – this is already 9.5%, which, when added to the share of the main owner, will in no way equal 100% of the assets.

Information from the BscScan website about the total assets of FLUX.

Information from the BscScan website about FLUX owners.

Third, by googling information on the FLUX / BNB trading pair, one could see that no one is selling FLUX at the rate offered in the wallet.

Information from the poocoin website on current FLUX / BNB transactions as of July 31, 2021.

Shitcoin Detective emphasized in their review that if a sale on such conditions were possible, then at least one person would be found who carried it out, but there is no evidence of this.

Fourthly, the GoFlux io point, which appears everywhere for “unlocking a token and wallet”, does not open directly, but redirects people to the fluxblockchain dot com. This site is a fake of the real site of the fluxprotocol project dot org. They differ only in two things – the name of the action button on the page and the presence of links to the project’s social networks for the org version (from com, the links simply lead to the main pages of Twitter, Telegram and other communication channels).

Fake FLUX page.

Real FLUX page.

Moreover, if you click on the “Get Airdrop” button on the fake page, you will be redirected to another page, where you will need to enter the amount of your FLUX and click “Unlock Wallet”. It is absolutely impossible to do this, otherwise you will lose all your assets.

How to protect yourself from asset theft by drops of fake tokens and in other ways

After several MetaMask users suffered from FLUX scams, the wallet’s support team released a list of 10 rules to follow to avoid falling victim to a scam. Some of the rules partially overlap each other, but since they are universal for all wallets, we summarized them for you below – read carefully and do not neglect any of the points.

# 1 Never share your SEED phrase with anyone

SEED is a phrase for restoring a wallet and funds on it. It includes at least 12 words and is randomly generated at the time of registration. This phrase can be stored in physical form – written down on paper or engraved in metal, or electronically – but it is better to create multiple copies in different trusted locations that are well protected.

In no case do not send the phrase to anyone, even close ones, and also do not enter it on any website. If anywhere you are asked to enter a SEED or secret recovery phrase, never do that. The only situation in which you can use your phrase is if you initiated the restoration of access to the wallet and the site of your wallet requests it after that.

# 2 Block requests for help in private messages

No wallet support ever writes to users in private messages. Usually, the support of a wallet or exchange creates a special chat with a support employee and sends information and answers in letters. Those who write to other users in private messages asking for help with something are scammers. They need to send complaints to technical support and in no case enter into correspondence. Do not do this yourself – ask for help only at the appropriate service or on the official forum.

# 3 Don’t sync or verify your wallet on any sites

Not a single honest site, including a poker room, ever asks users for authorization according to the data of a crypto wallet, since this is not needed to carry out transactions. If you are asked for such a thing, do not enter your data and do not confirm them.

# 4 Never go to third-party sites

If, in the process of making a deal or initiating a purchase, you are thrown to an outside site or a notification appears about the need to go somewhere, refuse and add the site or application with such an offer to the black list. The only exception is the cashier of the poker rooms, which exist as separate subpages of the sites. If you doubt that you are being redirected to a legitimate site, contact the technical support of the site on which you are trying to complete the transaction.

# 5 Ignore other means of communication besides the platform where you close the deal

If, for example, on an exchange or an exchanger’s website, you are offered to discuss the conditions or solve a problem by calling or texting in WhatsApp, Viber, Telegram, via video chat or on another site, do not agree.

Firstly, although some sites do have technical support in messengers, but it is indicated on the official website as one of the options and with already started correspondence with employees, for example, through letters, you will never be sent to another communication line – this is inconvenient in the first the queue for the service itself.

Secondly, the rules of any exchange indicate that the dialogue between the participants in the transaction must be carried out on the site of its implementation. If they are trying to take you away from it, it means that the person either wants to violate the conditions with which he entered the site, or seeks to rob you. In any case, this behavior is 100% suspicious, you need to report it to the support service and in no case agree.

# 6 Don’t get fooled by free rewards and check the conditions of promotions and sweepstakes

Wallet developers, exchange owners and managers, and even poker site owners never give away cryptocurrency just like that. Of course, they hold various raffles, promotions or give out bonuses, but to get them you always need to do something – and this action is always directly related to the service that promises to reward you. So, the MetaMask wallet will never offer you to get bonus tokens by doing something on some other site, and RedStar Poker will not give you a DOGE prize if you make a deposit somewhere other than the room itself.

So if you are offered to get something for free or with minimal investment, and a disproportionately large reward is promised, don’t get fooled. It is better to write to the support of the site or application with which the promotion or giveaway is associated to clarify the conditions.

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