Welcome to Cryptocurrencies — My first airdrop

Rohan Agarwal
Aug 26, 2017 · 5 min read

Cryptocurrencies and blockchain applications have taken over my interests and sleep in the past few weeks. Ask my family and friends — it’s all they are hearing me talk about right now. I haven’t blogged before, but this felt like the right topic to start with!

“There’s no such thing as free money”

Is this true in the cryptocurrency market? From geocoins that you can walk around and catch like Pokémon, clam coins that are waiting to be dug up, free Bitcoin Cash coins (currently worth over $600 each) for those who owned Bitcoin, it really starts to feel like there is free money.

The easiest way of getting free money is through a coin airdrop. Teams launching new coins sometimes give out a few coins to people at random. This is to encourage them to learn about the new coin and start trading it, and a few coins have used this technique to become really popular.

A few days ago, I was thinking how awesome it would be if I received an airdrop. Later that same day, I’d have my chance…

district0x.io

I recently learned about a new platform called district0x. District0x is building tools to allow people to form, operate, and govern decentralized organizations on Ethereum. After reading the white paper, I was really excited about some compelling use cases that they are working on. Additionally, I liked that the District0x team is transparent and that they openly disclose the roadmap, overall project contributions, and wages of the team members. It’s something you don’t usually get to see from other teams starting their own cryptocurrency. Given all of these factors, I was excited to invest in some coins.

After investing in district0x, I joined the District0x Slack community to keep up with updates. A few hours later, I received the following notification from the District0x slackbot.

The slackbot further instructed me to a blog post written by one of the founders with more details of the airdrop.

Awesome, free coins are coming my way! I clicked the next link which took me here:

I entered in a few numbers to see what would happen and eagerly pressed continue.

A few of you might immediately recognize what’s wrong here. While I felt like something was off, in the excitement of getting thousands of DNT coins, I didn’t see the problem. Since some of my ether and DNT coins were split across exchanges and wallets, I decided to first consolidate all my coins into one wallet. After that, I would go ahead and claim the DNT.

While I was consolidating all my coins, I browsed the District0x Slack channels to see what other investors were saying.

When I clicked one of the channels, I saw:

Whoa.. what’s going on? The slackbot told me earlier that there was an airdrop? Also, the co-founder himself said there was an airdrop. Puzzled, I visited the airdrop page again and then realized — oh wait, it’s asking for my private key! Crypto 101 — never ever give out your private key!

So why is the District0x Slackbot, a founder, and the website all saying that there’s an airdrop? I couldn’t imagine all of them were hacked. The answer was in the URL of the airdrop website:

It was a classic phishing attempt. The correct website domain was “.io” while this domain was “.net”, and the website UI was just an imitation of the actual website. The blog post was also fake and wasn’t written by one of the founders. Additionally, the Slack community settings were public, allowing anyone to set up an automated message for the slackbot.

Phew, that was a close one. I want to think that even if I hadn’t seen the Slack channel warning, I would have realized this was a scam before actually uploading my private key. I read dozens of websites before starting to trade cryptocurrencies that all warned me that scams exist and to never give out my private key. However, it’s amazing how much of the basics you can forget when your mind is focused on free money.

Other members of the Slack community weren’t as lucky as me.

Ouch. The person goes on to discuss how he had purchased 15 of those ether at $40 each. Months of hard work and $35000 were wiped away in minutes.

The immediate response of other folks in the Slack channel was generally sympathetic, though a few people were also insulting and harsh.

It was good to see that a few members of the Slack community were willing to help as much as they can, by reporting the public address of the hacker and potentially monitor exchanges for the hacker’s activity.

Looking at the hacker’s public address on etherscan.io, you can see that the person duped many people — some for many more coins. It’s pretty unbelievable how much money the hacker made from this scam in just a few hours.

You really don’t know how crazy the scams are and how careful you need to be when trading cryptocurrencies until you experience it firsthand. Everyone is looking for the next coin that they think will go on a rocket ship to the moon, and no one wants to miss the flight. After just a few weeks of trading, I can feel the sentiment, and I can see how it clouds better judgment.

I wrote this post to remind myself and others — whether you’re experienced with trading or not, be careful of this scam and the many more out there!

Feel free to leave comments and let me know your thoughts and experiences! Also, if you found this post helpful, feel free to “airdrop” me some coins :)

My ether public address: 0x5cC14B4318D8f67216decC5424dCdDBAdAaD3e96
My bitcoin public address: 14K1axCGwFfvkZm2PA9FVCf9Lii1B2UT5d

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