Common crypto scams

Fake Trust Wallet mobile app out to get your crypto

Crypto KP Common crypto scams, Fake crypto apps , ,
Fake Trust Wallet

Crypto enthusiasts and crypto wallet app users should be aware of the insidious scammers planting fake Trust Wallet apps on app stores and links to them, to scam you of your coins. And this is not the only nefarious means that scammers will try to trick you out of your crypto coins bags. If you’re a Trust Wallet user, or thinking about it, make sure you read on to find out what other Trust Wallet scams are out there and how to stay safe in the wild wild west of crypto.

Trust Wallet is a popular target for scammers as its one of the most popular and versatile apps available to transact your crypto and make money with DeFI. If you want to know more about Trust Wallet, you can check out our full review of what it is and how you can use it to make passive income with DeFi – here.

Our Decryptify blog is all about helping you keep your crypto safe so here is a snapshot of what to watch out for.

Fake Trust Wallet reports online

Fake Trust Wallet apps have been reported on the Trust Wallet community and on Reddit in both 2020 and 2021. Multiple times. While they’re eventually taken down, they keep popping up because they’re obviously successful at scamming new people each time. The thing with a crypto wallet app is you need to set up a seed recovery phase (private keys to your crypto) when you create the wallet. This is the mechanism scammers use to grab your coins once you send them to your wallet. The app records your phrase as you input it and the scammers then use it steal your coins.

Here is what the fake Trust Wallet app looked like. Notice, the name of the developer is the first giveaway.

FAKE app by Trust Wallet LLC

This is what the REAL Trust Wallet app looks like:

Real App by DApps Platform Inc

Fake Trust Rewards offers

Scammers have also propagated fake Trust rewards offers like the ones pictured below. You’re enticed in by offers of an Airdrop or other incentive payments and the MO is to get you to click their links. You can spot a scam like this straight away because you are then asked to input your private keys to get access to the rewards. Legitimate projects and developers in crypto will NEVER have a reason to ask you for your private keys, so don’t be tempted by the promise of big rewards or free crypto.

Fake Trust Facebook accounts

Readers should also be aware of Fake Trust Wallet accounts popping up in Facebook and on Telegram. Straight from the trusted team at Trust Wallet, here are some tips on how to spot a fake FB account:

The MO of the scammers setting up these accounts is similar to the above – they use the promise of incentives if you follow their links and provide your private key details to claim the rewards. Once they have your keys, any crypto you had associated with that address is gone. If you are new to crypto, rewards schemes, Airdrops and competitions are common in the crypto community. However its up to you to identify what is legit and what is not.

How to keep you crypto safe

  1. Only ever download the app from the Official Trust Wallet site. This goes for any crypto wallet app you want to down load. Do not search on the name of the app in Apple Store or Google Play if you want to keep your coins!

2. Make sure you know the name of the developer so you can double check this when the app store link opens up.

3. Don’t rely on the number of reviews in the apps store – this feature is easy to replicate with bots. READ THE REVIEWS IN THE APP STORE! If folks are on the site saying the app is a scam, look into it!

4. Get on to the Trust Wallet Community or Google “Fake Trust Wallet App Reddit’ and read through some posts.

5. Only participate in rewards or incentive programs with legitimate exchanges and projects. Only every access these directly from within the project’s official site. Don’t click links from other sites or accounts to participate in reward schemes, airdrops or competitions.

6. And the most important way to keep your crypto safe – NEVER GIVE YOUR PRIVATE KEYS OUT TO ANYONE! If anyone every asks for your private keys that is a sure sign you’re about to be scammed.

Stay SAFU in crypto!

DeFi rug pulls – how to protect your crypto

Crypto KP Common crypto scams , ,
protect your crypto

Crypto is hyped as the investment opportunity of a lifetime, but it’s also a veritable minefield of hacks, scams and fraud. As they say, ‘no risk, no reward’. With over $100B invested in Decentralised Finance in 2021, its fruitful ground for hackers and scammers. So how do you protect yourself AND further your investing at the same time? In this post we’re going to look at the phenomenon ‘DeFi rug pulls’ – how to spot them and how to protect your crypto.

The anatomy of a DeFi rug pull

A DeFi rug pull is when a team of developers disappear with all of the liquidity added by users to a particular DeFi Protocol. But what does this even look like? Here’s a step by step of the MO of scam token creators:

  1. Scam token creator / developer launches a protocol on a particular network – like Polygon, Binance Smart Chain or Ethereum – with webpage and their own scam token.
  2. The project and the token are hyped on online crypto hangouts like Telegram and Twitter using fake groups and bot group members.
  3. The developer then creates a pair between the scam token and a valuable token on a DeFi platform that is perceived as legitimate, such as Uniswap or SushiSwap, and adds liquidity for the newly hyped token.
  4. Users swap their valuable tokens for the scam token on the promise of mind blowing returns – like 5000% APY and above. This drives the scam token price up.
  5. As the price of the token rises, more users participate in the swap due to FOMO (fear of missing out).
  6. The scam token creator removes the valuable token from the platform and dumps the scam token. The liquidity pool is drained and other holders no longer able to trade or swap.
  7. Users are left holding worthless scam tokens with no place to withdraw or cash out.
  8. And so on, and so on it goes…

The rise of DeFI rug pulls and exit scams

According to Ciphertrace over half of 2020 crypto hacks were from DeFi protocols. Rug pulls and other types of DeFi exit scams are on the rise as more capital flows into the DeFi space with a reported $240M lost in just the first 5 months of 2021.

2021 DeFi theft ($ stolen) are almost double the 2020 figure in the first 5 months of this year alone

Recent DeFi rug pulls

There is a litany of rug pulls online that you can delve into if you’re interested in understanding more about how they work so you can protect yourself and your coins. You can read all about the more recent alleged DeFi rug pools here:

HoneySwap, CrossaintSwap, Turtle DeX

Thodex, Compounder Finance, Meerkat Finance

Titan, Iron

Dodo Finance, PAID network

More rug pulls..

How to protect your crypto

The thing to understand about decentralised blockchain networks is that practically anyone can build decentralised apps on them. If you’re going to add your coins to these protocols, then all of the due diligence is up to you. If you’re not into doing the leg work, they you may have to accept that your coins are at risk.

  1. Avoid early stage DeFi projects – some folks will say this is where the money is made, but it’s also where authenticity and legitimacy are at their most unclear. At a minimum avoid low initial liquidity projects if you are keen to invest in the early stages. Scammers will find it hard to raise large amounts of initial capital.
  2. Make sure there is a project whitepaper and read it. Compare it to other legitimate protocol white papers to help decide whether it appear legitimate.
  3. Is there are huge social media blitz on the token with unreasonable claims of benefits? Watch out for fake hype on Telegram and Twitter. Stay away from these projects.
  4. Research the project – is the developer team transparent and known in the crypto community? If the developer team is anonymous do you really want to trust them with your coins?
  5. Get on to Reddit and research the token and the project and any red flags raised by other developers.
  6. Check that an audit of the protocol has been done by an independent know auditor. Audits are expensive and having one legitimises the project.
  7. Check whether or not the liquidity is locked on Unicrypt.com. Check the smart contract history on Etherscan or Polygonscan.
  8. Watch the token price and pay attention to the Protocol. If the token price starts to tank, get your investment out immediately. This means offloading the scam token and sending your valuable tokens back to your hardware wallet! Don’t leave coins in your crypto wallet app unless you’ve been on to Etherscan or Polygonscan and revoked all of the token approvals you’ve previously confirmed in association with the scammers Protocol.

Never invest in DeFi projects that are very new, with anonymous teams, made as memes, and have a lack of real utility

7000 Americans scammed out of $1900 in cryptocurrency scams

Crypto KP Common crypto scams , ,
Cryptocurrency scams

If you believe the US Federal Trade Commission, an agency tasked with protecting American consumers, the number of reported cryptocurrency scams is skyrocketing. In a May 2021 post, the FTC reports that cryptocurrency scams have exploded since October 2020 resulting in losses over that period of around $80 million USD. The average loss per reported scam? $1900 USD.

Common cryptocurrency scams

According to the FTC, some of the most commonly perpetrated crypto scams are:

  • giveaway scams where members of particular online crypto communities get free coins if you send your coins to a posted wallet address
  • bogus websites with scam investment opportunities offering block buster returns using fake testimonials
  • Elon Musk impersonators that have duped unsuspecting coin holders out of $2 million collectively
  • Online dating apps used to lure people into cryptocurrency investments (yes, you really did read that!)
Are you being scammed? Ask yourself this before you send your crypto.

So who is getting duped out of their dough?

Apparently, people aged 20 to 49 were 5 times more likely to get caught up in a cryptocurrency scam. But this probably a reflection of the crypto demographic more than anything. Older crypto investors are losing in smaller numbers but their losses are bigger at an average of over $3000.

How to spot cryptocurrency scams

You’ll notice that most the scams above involve some kind of impersonation – of an individual, a Project, a crypto community group. The first thing you need to do is verify who you are dealing with and that they are legit. Before you invest, check them out. Google the name of the company, entity or cryptocurrency, plus words like “review,” “scam,” or “complaint.” See what others are saying.

Another commonality between all of these scams are the claims of big payouts, guaranteed money, and free returns. Scammers prey on greed and ignorance. While crypto markets are know for their incredible market growth rates, these are generally found buying small cap coins and tokens from legitimate exchanges. If you come across an ‘investment opportunity’ that seems too good to be true then it just is.

The third characteristic of scams is the double down investment offer. A request out of the blue that you double your initial investment in order to get the promised returns.

Another common feature of these types of scams is that they are unsolicited. Someone reaches out to you to join a crypto community or promote a killer crypto investment opportunity. If this happens over social media, via email, in Youtube comments or in any message group forums its a scam.

Finally, all of these scams ask you to send your crypto to a public wallet address that they have posted themselves. Don’t do it if you ever want to see your coins again! Instead, leave your crypto in your hardware wallet and only send it to addresses you have verified or have been generated within a secure website or app. NEVER send your crypto to wallet addresses sent to you in unsolicited emails, social media, group chat apps like Telegram and WhatsApp.

And if you do get suckered in by evil scammer and live in the US, you can report the crypto scam here.

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