Detecting Airdrop Scams #Essentials
Scammers and fraudsters have always been a separate group of people having their own culture, language, and secret ways they used to deceive people. Before the creation of the Internet, or even earlier, before the invention of computers, or let’s go even further, before the technological breakthrough in Europe, regular folks knew who the scammers or fraudsters are. At that time it was difficult to do malicious acts secretly.
The opposite we see right now. Online fraudsters and bad actors are difficult to track. They are disguising themselves. If we talk about Web2 fraud, then there is a chance that the ill actor could be found. There are technologies to connect Internet data with the person and establish their identity. However, the Web3 ecosystem made fraud anonymous, which automatically placed it on a low shelf next to the jar with free cookies making it easy to reach. That’s why many people who are inclined to fraud act freely and unpunished.
What does all this leave us with? In case there is no protection from fraud in Web3, it means that we should protect ourselves independently, being watchful and trying not to be caught in the scammers’ nets. One of the types of scams in Web3 is the Airdrop scam. So let’s delve into it and discuss the ways we can protect ourselves from it.
🏬 What is Crypto Airdrop?
Free distribution of crypto is called Airdrop. One of the ways is to send new crypto of a new or emerging project asking for very simple actions from the user. These could be sharing the project online, putting like, or just talking about it on social networks, spreading the news. Such a type of Web3 marketing has another side. Spreading word of mouth brings more users and makes the project well-known. As a result, the value of the crypto distributed is growing. It means that later we can exchange it into other cryptocurrencies or fiat. Crypto Airdrop was designed to be a means of strong community development, but, unfortunately, it’s not always like that, otherwise, there will be no reason for this post.
🦹♂️ How to Recognize an Airdrop Scam?
It’s essential to understand that scammers use Airdrops in two main ways. One way is to drain the money from your wallet by sending you malicious tokens. Sometimes malicious users may ask you to provide your private key, which means that anyone could get access to your wallet, so don’t even think of doing so. The other way is to use Airdrops as a stage in a bigger fraud scheme when bad guys are not actually interested in the project or the crypto minted. What they want to get is only value and if you are unwary, they will get it. Buckle up and let’s go through the 5 main deceiving strategies known so far so you can watch out for airdrop scams.
- Unknown Drop to Your Wallet
Not all free stuff is good stuff. Always remember that, when you find some unknown drops in the wallet. Scammers are doing this hoping to get your attention. After they grab it, they need you to bring the token to swap. Don’t even think of doing that, there is a high probability that a malicious code would be activated and you can lose all assets from your wallet.
- Airdrop From Fake Domain
Quite often scammers take known domains and gently change the branding style. They achieve a brand similarity effect and try to evoke your excitement to get free crypto. Don’t be gullible and don’t click on anything in those fishy emails.
- Fake Community
Some fraudsters go even further. They create a whole fake community or group in Telegram with the same name as a legit Web3 service provider. From the name of the entity they run crypto Airdrops and may trick you into buying malicious crypto.
- Phishing Website
Phony Airdrops could lead sometimes to fake websites. Because the practice of claiming an airdrop differs from project to project and some require the connection of your wallet to the entity website, you should be exceptionally careful. As soon as you provide the seemingly authentic website with your wallet keys and sign a transaction, probably the next second your assets will be washed out. Please, always DYOR.
- Request for Crypto Transfer
If you find yourself in a situation where the Airdrop is asking you to transfer some crypto to activate free tokens, it’s highly likely a fake Airdrop. Legitimate Airdrops, which are normally listed on coingecko.com and coinmarketcap.com, would never ask for money or any seed phase.
🚨 Of course, all types of Airdrop scams are not restricted to the ones we discussed. Also, a big problem for Airdrops is Sybil Attacks. This type of scam affects not only Web3 service providers but also Web3 users. Sometimes, a platform wants to encourage users by sending them crypto but instead of sending it to unique users, it is sending assets to fake accounts that are claiming the Airdrop alongside the real community members. If the Sybil attack is on the roll, then the percentage of fraud would be high. It means that there is a big fat chance that you, as a unique user, will miss the drop. You and other users could complain and the situation ends with Airdrop withdrawal. In the case of Airdrop cancellation, no one is happy. The platform loses its reputation, trust, and support from the community. And you, as community members, eventually are left in the cold with no crypto in your pockets.
To prevent such a scenario, it’s wise to launch identification mechanisms compatible with the Web3 paradigm and are easy to apply. One such means is Unika — a decentralized anonymous identification protocol. It links users’ unique biometrics, transferred into the encrypted piece of code, with their blockchain addresses enabling only one unique user to receive one drop at a time.
You can read more about the project here. Stay safe on and off chain! ❤️
