Crypto Scammers Are Now Stealing From Other Crypto Thieves

Scammers use a sophisticated type of wallet to trick wannabe thieves, who may lose small amounts of a token.

Dec 30, 2024, 12:48 p.m. UTC

Crypto scammers have finally found their thieving match: Themselves.

A new scam has been making the rounds mainly on YouTube that would make even the most cunning trickster tip their hat, security firm Kaspersky said in a security update last week.

“I have USDT stored in my wallet, and I have the seed phrase. How do I transfer my funds to another wallet?,” Kaspersky noted one such comment. The specific wallet held over $8,000 worth of stablecoins on the Tron blockchain. A seed phrase is a word string that grants their knowers access to a crypto wallet.

This question, however, was not from a crypto novice but a cleverly laid trap. Those stablecoins were held in a multi-signature wallet, and theoretically require a gas fee to be able to withdraw funds.

However, when thieves attempted to siphon off the funds by sending Tron’s TRX tokens to the wallet, the sent tokens mysteriously evaporated into another wallet controlled by the scammers.

The catch is that the bait wallet is set up as a multi-signature wallet. To authorize outgoing transactions in such wallets, approval from two or more people is required, so transferring USDT to a personal wallet won’t work and instead gets transferred somewhere else.

“The scammers are impersonating beginners who foolishly share access to their crypto wallets, tricking equally naive thieves — who end up becoming the victims,” Kaspersky said. “In this scenario, the scammers are something like digital Robin Hoods, as the scheme primarily targets other crooked individuals.”

This scam isn’t a lone wolf either, with several instances across the internet teeming with similar comments from new accounts, all of which dangled the same seed phrase, Kaspersky said.

As such, gas fees are typically cheap and cost less than $10 across most blockchains, meaning the hustle is likely targeting wannabe thieves rather than being a complex operation seeking to steal thousands, or even millions, of dollars.

But expect a crypto criminal to make money whenever there’s a chance to.