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Social networks, the hook for fraud also with cryptocurrencies

July 24, 2021 | 7:00 am

Social networks are the internet space where users spend more and more time.

In fact, in Mexico Internet users who have a mobile device check their networks at least every three hours, a scenario that has made social networks the perfect place to commit fraud.

We are not only talking about scams on the rise through networks such as Instagram or Facebook, because now network frauds also occur under slightly more elaborate schemes on platforms such as YouTube.

While most of the scams on these networks are of a buy-sell nature, virtual crimes are reaching cryptocurrencies.

According to Satnam Narang, Research Engineer for the Security Response team at Tenable, scammers are increasingly using social media, and YouTube in particular, to perpetuate crypto-related fraud.

Currently, scams range from the simple ones, where people fall for the promise of doubling their money, also known as ‘advanced fee fraud’, to more complex scams that involve fake cryptocurrencies.

These cryptocurrencies are tradable through Uniswap, Sushiswap, and other decentralized exchanges.

Uniswap is a decentralized exchange (DEX) popular in the world of decentralized finance protocols (DeFi).

The strategy

A decentralized finance protocol allows cryptocurrency holders to exchange tokens on the platform without the involvement of a centralized entity.

Transactions take place on the blockchain and funds are distributed to users in their own cryptocurrency wallets.

No one is holding user funds, so you don’t have to relinquish control at any time. The lack of a central authority is one of the reasons these scams can operate successfully.

Satnam Narang, Research Engineer for the Security Response team at Tenable

The specialist explained that cybercriminals use social networks to gain the trust of victims and ‘validate’ the credibility of the scam by compromising Twitter accounts and YouTube channels.

Many users rely on YouTube to better understand cryptocurrencies, making it a natural place for scammers to focus their strategy there. And if the potential scammer “bites the bait,” there is no going back.

Because the cryptocurrency is based on decentralization, it is impossible for users to recoup their investment, the specialist warned.

Registered cases

In their most recent investigation, scammers promoting fake SpaceX currency were able to steal more than a million dollars.

In early May, scammers compromised Twitter and YouTube accounts to promote a series of cryptocurrency scams ahead of Tesla and SpaceX founder Elon Musk’s appearance on Saturday Night Live, stealing more than $ 10 million in Bitcoin, Ethereum and Doge tokens.

This shows that users do not measure the high risk of these scams, so considering the internet penetration in the country, the potential impact of these scams is serious.

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