Bitcoin trader squanders $70M by sending it off to the wrong address

The anecdotical incident was not the result of a mere oversight, but rather a well-executed scam, the victim claims

Scammers have got more ingenuous in the way they access crypto holdings, and the recent incident involving $70 million worth of Bitcoin sent to the wrong address by an investor shows that no one is really safe when it comes to fraud in the crypto world. A cryptocurrency trader reportedly lost the sum after becoming the victim of an “address poisoning scam.”

Hackers have got more interested in targeting high-value accounts by creating spoof accounts of their victim’s crypto addresses. Basically, the criminals send small amounts to traders, hoping that their victims would then not see the difference in the addresses and send larger amounts back to the spoof addresses.

Things are not aided by the fact that the crypto addresses are actually public, because of the ledger, and you can see how much each address owns. This means that over time, hackers can keep bombarding their victims with small amounts continuously, and to avoid becoming a victim, investors would then have to carefully cross-check every individual address they have in their history.

The scam has also been confirmed by CertiK, a blockchain security firm, which said that indeed $70m worth of Bitcoin was lost in an address poisoning scam. The victim has effectively lost 97% of their holdings based on their Coinbase account history and has left a little over $1.6 million left. Peckshield, another crypto security firm, has also been hot on the trail, confirming that the scammers have moved the Bitcoin into Ethereum, and have transferred the funds.

A scam of this proportion may seem unlikely and usually only involves hacks carried out against exchanges or protocols that lack proper security measures, but as it turns out – hackers are becoming more deceptive and successful in executing their scams. This gutting loss must serve as a warning to the crypto community as a whole and once again puts the onus back on crypto traders to be ever vigilant.

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Written by Barney

Co-founder

Barney is co-founder of CryptoGamblingNews.com. When not at work he can usually be found behind a Nikon. He's won numerous international competitions for his photography and volunteers as a content creator for aid organisations in Africa.

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