Kaspersky’s Investigations Identify Illegal ‘Schemes’ For Gaining Cryptocurrencies
Noted cybersecurity firm, Kaspersky’s latest findings point fingers at how criminals are able to manipulate the cryptocurrency industry to ‘engineer’ and gain millions of cryptocurrency value. Ethereum of 21,000 units valued at $10 million was supposed to have been gained by these criminals.
In news that has been a bit of a surprise to the common investor in cryptocurrency, the Russian online security firm identified the means and methods criminals used to earn coins.
According to the company, it was found that in 2017, millions of cryptocurrency was earned by criminals by simply indulging in ‘social engineering schemes.’ The company provided exact details of this engineered scam in a definitive report.
What were the schemes?
The investigations of the security software firm conducted led it to the clear technology manipulation that criminals could engineer to gain coins in an illegal manner. The scams were essentially related to ‘giveaway’ programs of ICO. The motivation for criminals in developing this strategy was the legitimate techniques businesses used to launch their operations.
According to the report, “Some of the most popular targets are ICO investors, who seek to invest their money in start-ups in the hope of gaining a profit in the future.” It adds that the ICO-framework schemes will consider the issue that the criminals would build fraud websites and set up messaging and email services, just like the legitimate websites would operate. These emails would typically be ‘phishing’ scam and would use scammers to gain funds and other sensitive information via trusted parties.
Which are the Scams
The security firm identified some of the schemes which were actually ICO scams. The first on its list was the Switcheo ICO scam, and criminals were stealing over $25,000 by asking clients to move to an address for cryptocurrency on Twitter. The rerouting of funds from the actual ICO wallet or the official wallet to the criminal’s wallet were affected by this deroute.
OmiseGo ICO was the next project, on the Ethereum network. The method used was similar to Switcheo, and ‘hundreds’ of fake websites were built to lure users to move cryptocurrencies to the ‘legitimate address.’ The money the OmiseGo could earn fraudulently was $1.1 million and was the most damaging in terms of ‘social engineering.’
Analysts at Kaspersky, Nadezhda Demidova, says, “These new fraud schemes are based on simple social engineering methods, but stand out from common phishing attacks because they help criminals make millions of dollars. The success criminals have enjoyed suggests that they know how to exploit the human factor, which has always been one of the weakest links in cybersecurity, to capitalize on user behaviors.”
And the security firm was quick to point out that its new age security products were very effective in ‘staving off’ such scams. It took the opportunity to present to its audience that its products could block well over 100,000 attempts in the scam and users would ‘fake exchanges and other sources,’ in the period between January and June of 2018.