Hackread.com has adopted a strategic partnership with Verify Token to help educate investors to make crypto safer for all.
As world economies reel from the unprecedented disruption of a modern global pandemic and as the world’s population learns to adapt; there lurks behind the scenes a pandemic that threatens to decimate businesses and lives long after Covid-19 becomes a distant, albeit horrible memory confined to the annuls of history.
The Covid-19 Pandemic saw a global shift towards remote and hybrid working. Almost instantaneously, businesses large and small had to gear the way they conducted business. This urgency and lack of preparedness had one group of people consumed in a mass orgy of excitement. People who often revel in such crises – the cybercriminals, scammers, and fraudsters.
If traditional cybercrime was not enough to whet the appetite of these groups and/or individuals, there is a new sector for them to get their teeth into. A sector valued at over $1trillion that is expected to grow exponentially over the next decade.
The sector in question is Cryptocurrency. Not only is this sector awash with money; but it is also populated by an ever-increasing number of people who are novices at best when it comes to understanding the full extent of threats facing them daily.
It is also a sector where people just do not seem to behave as they would do in any other aspect of their lives. Ever ready to trust people, always willing to take advice from strangers, and somewhat disturbingly, many seem to exercise very little due diligence before giving people their money or connecting their crypto wallets to websites and apps. It is no surprise that a scam, a theft, a rug pull, or a hack is reported in this sector daily.
Some key points…
- According to the UN, cybercrime during the pandemic is up 600%
- Cybersecurity ventures predict the annual cost of cybercrime globally will reach $10.5T annually by 2025. Were cybercrime a nation, it would be the 3rd largest economy in the world.
- Small to medium-sized businesses are struggling to tackle cybercrime according to the Ponemon Institutes State of Cybersecurity Report.
The most common type of attacks against small to medium-sized businesses are:
- Phishing/Social Engineering
- Compromised or stolen devices
- Credential theft
It is not just businesses that fall victim to cybercrime. According to NortonLifelock and the Harris Poll, a staggering 330mil people from 10 countries were victims of cybercrime in 2020 with this figure expected to be higher for 2021.
If compromising IoT, ransomware, phishing, identity theft, etc. were not enough to satiate cybercriminals; the growing popularity of cryptocurrencies has given another avenue to a whole new world where victims are aplenty.
The growth of Bitcoin alone between 2020 and 2021 has given rise to unprecedented levels of cybercrime-related incidents. These include exchange hacking, wallet hacking, social engineering, phishing, RAT’s, and the criminals are not stopping there. They are becoming ever more sophisticated in their approach and the technology used.
The wave of attacks has been compounded by the sheer number of altcoins and meme coins that have morphed in the last 12-18 months. The decentralized nature of the Blockchain and altcoins has meant criminals can operate in this space with relative impunity. This is further aided by the fact Blockchain and cryptocurrency are still in their infancy. The vast majority of entrants and/or investors in this sector are novices who seem to neglect safety in favor of chasing quick rewards. There is no snare quite like blindly or greedily chasing profit.
According to Chainanalysis:
- Scammers around the world have taken $14 billion from cryptocurrency in 2021
- Losses from crypto-related crime rose by 79% from 2020
- Cryptocurrency theft increased by 516% from 2020 to $3.2 billion. Of this total, 72% of stolen funds were taken from DeFi protocols.
It is not just hackers compromising security. Rug Pulls are an epidemic in cryptocurrency. This is particularly the case with tokens on the Binance Smart Chain network. The barriers to entry are so low due to its decentralized nature, criminals can, within a matter of hours put together a copy smart contract and with some clever marketing, can entice thousands of potential victims chasing that pot of gold to part with their money.
What is a Rug Pull?
A rug pull is a type of scam where a project’s founders suddenly pull out, taking investors’ money with them
The most notorious case of a rug pull to date is the meme coin inspired by the hit Korean TV series on Netflix, Squid game. From the day of its launch on Oct 26th, 2021, SQUID Token used the popularity of the show to gain 23,000,000% in value in just one week. Then, just like that, it collapsed with the criminals have made off with over $3m worth of investor funds leaving many with a token they can no longer sell.
It is not just rug pulls that need to be understood by potential investors. The need to understand the many ways these criminals operate is of paramount importance.
Types of scams…
- Social engineering scams – this is where deception and psychological manipulation are used to gain access to a user account or wallet.
- Dating scams – This is where an unsuspecting user is tricked into believing they are in a long-term long-distance relationship. According to the Federal Trade Commission, 20% of all funds lost in cryptocurrency are lost in dating/romance scams.
- Giveaway scams – this is where a scammer will impersonate a famous personality or a business and offer to match cryptocurrency sent by way of a giveaway. According to the FTC, the 6 months to 31 March 2021, more than $2m have been sent to Elon Musk impersonators over social media.
- Phishing scams – with specific reference to crypto, phishing scams relate to scammers wanting access to the private keys to an unsuspecting user wallet. The method is the same as traditional phishing scams. An email is sent with a link to a fake website, when it is clicked, the user is encouraged to enter their private keys.
- Extortion – this is an amalgamation of social engineering and dating scams. Scammers coerce individuals to send compromising videos or images of themselves or claim to have access to compromising information and threaten to release this to the public and/or family members unless funds are sent.
- Business opportunity scams – this is where unsuspecting speculative investors are encouraged to invest in the next ‘big thing’. If it is too good to be true, it often is. However, the promise of riches often lowers many a guard.
- Cloud mining scams – this is where investors are asked to submit upfront payment to a mining operation with the promise of a share in profits. Often these scammers do not own the hash rate they claim to do, leaving the investor out of pocket.
- Nuevo crypto opportunities – with the sector constantly growing with new avenues for investment such as NFT’s (non-fungible tokens), there exists greater opportunities for scammers to exploit at a greater pace.
Why The Strategic Partnership
Cybercrime in infosec and cryptocurrency are not mutually exclusive. They share similar methods, rely on similar psychology, technology, and invariably have similar outcomes.
HackRead has been reporting on cyber security and educating readers on how to avoid being a victim of cybercrime for over 12 years. It has built a stellar reputation in the industry and is regularly quoted as a source of information.
One thing has become apparent in the 12 years HR has been operating; that is, cybercriminals are not going anywhere anytime soon. In fact, data suggests cybercriminals are getting more sophisticated and more aggressive in their approach. This is particularly the case within the cryptocurrency sector.
Combatting cybercriminals is always a losing battle. The reason for this is people. People are commonly the weak link in any security infrastructure as humans are fallible creatures. They make mistakes. They get careless or become complacent or they simply get greedy.
It is the view of HackRead that the best defense against cybercriminals is to educate the very people they target.
Verify Token is a natural fit for HackRead. They are run by an experienced team whose dedication is to combat scams within the crypto space. They have a utility, Verify Lens, due for launch in Q1 of 2022 where the focus is on exposing potential red flags within cryptocurrency projects. Their strategy to combat these criminals is to educate the investor and make the crypto space a place where criminals can no longer operate with impunity. This emphasis on the education of potential victims aligns both HackRead and Verify Token in a shared goal.
Verify Lens is the utility behind Verify Token. It serves as an all-in-one investor tracking dashboard and analytics that reflects a safety rating or ‘Verify’d’ score on a project or token. The goal of Verify Lens is to bring greater transparency to the high-risk DeFi sector.
Lens will take into consideration key data metrics such as (but not limited to):
- Token contract analysis (this will see if the contract itself has a large proportion of tokens within dev holdings and others)
- Token wallet holder analysis (Provides evidence of suspicious activity such as whether large unbacked tokens are being moved, as is the common case with rug-pulls and scams)
- Liquidity Lock (unlocked liquidity is a huge red flag for potential rug pulls)
- Social media analytics (this will provide information from their active platforms)
- And more
All these key areas will be analyzed by the unique Verify Lens algorithm which will, in turn, produce a Verify’d score to determine an objective view on the safety of the project.
Verify has put together a team of experts in many disciplines who combined, share a wealth of knowledge in Blockchain technology and cryptocurrency. Primarily, they are educators with a passion for fairness and believe, like HackRead, that through education, they can make life a little less fruitful for scammers.
The American historian, philosopher, and writer Will Durant once said, “Education is the progressive discovery of our ignorance” and it is this ignorance that leads to so many people being scammed.
This is an exciting partnership for both HackRead and Verify and through it, we seek to collaborate in educating the masses to make life a little more complicated for those nefarious individuals who seek to make life a misery for so many.