Have you ever come across a disheartening story about someone falling victim to a hacking or scam, losing a substantial portion or even all of their assets? It's a scenario none of us wishes to experience.

It is reported that over 46,000 people reported losing over $1 billion in cryptocurrency to different scams between January 2021 and June 2022, and that number just includes people who voluntarily provided this information to authorities. Knowledge, as they say, is power, and being aware of scams and their operations provides you with an advantage in both detecting them and swiftly disengaging.

Web3 Scams

First and foremost, it's crucial to recognize that with every technological innovation comes both opportunities and challenges. Web3, with its promise of a decentralized web and enhanced security, has attracted not only innovators but also fraudsters seeking to exploit individuals for their funds. Below are common Web3 scams encountered by both newcomers and seasoned participants, along with insights into how they operate.

Phishing Attacks

Phishing link scams involve the use of malicious links to collect sensitive information, such as seed phrases, from unsuspecting victims. This information is then utilized to steal the victim's assets.

Malware/Ransomware

Through malicious links, hackers can infect your device with viruses that may either steal your cryptographic keys or lock your device, demanding a certain amount of cryptocurrency to unlock it.

Catfishing & Impersonations

Scammers create fake profiles of celebrities, companies, or projects to convince unsuspecting individuals to invest or disclose sensitive information, often using direct messages.

Rug Pulls

In a rug pull scam, project creators vanish with investors' funds, leaving them with no projects, no liquidity, and tokens of little or no value.

Pump and Dump Schemes

A group manipulates the price of a token, inflating prices, and then sells off their holdings for substantial profits, leaving others with devalued tokens.

Pay Zero Scams (Specific to NFTs)

A pay-zero attack occurs when a scammer seemingly "buys" a crypto asset for zero money by manipulating the transaction process.

Poison Attacks

Hackers create a wallet address resembling the victim's, leading them to send assets to the hacker's address, thinking it's their wallet.

Bidding Scams (Specific to NFTs)

Scammers pay with a different token and for a significantly lower price than the listed NFT value during a bidding scam.

Giveaway/Airdrop Scams

Projects offering free tokens request keys or phrases, claiming it's necessary to send the prize.

General Safety Rules

Now that you're aware of Web3 scams and their operations, here are safety rules to reduce the chances of falling victim:

1. Never share your seed phrase or private keys with anyone.

2. Avoid clicking on suspicious emails or links.

3. Read and crosscheck contract details before signing transactions.

4. Do Your Research (DYOR) on projects before engaging. And do well to always disconnect wallet from dapps and smartcontracts you wouldn't be interacting with regularly.

5. Enable 2FA on all available accounts.

6. Use a Hardware wallet to keep assets offline.

7. Prefer Non-custodial wallets to truly control your coins.

8. Consider using burner wallets for one-time transactions with new platforms.

9. Regularly update your software for security upgrades.

10. Crosscheck every URL and bookmark legitimate websites.

11. Back up your wallet securely.

12. Avoid greed; be cautious of scams disguised as opportunities.

By following these safety rules, you empower yourself against scams and contribute to a safer Web3 experience. Stay vigilant, stay secure!