Dusting attack

Since bitcoin debuted to the public more than a decade ago, proponents have lauded the benefits of cryptocurrency exchanges, including decentralization, transparency and anonymity. While these benefits certainly have their advantages, the nature of cryptocurrencies also exposes you to a certain level of risk, which has been realized through activities such as dusting attacks and airdrops that often go completely unnoticed if cryptocurrency holders don’t know what to look for.

Definition of dust

In the world of cryptocurrencies, “Dust” is a tiny amount of money or tokens that people can usually ignore. Take Bitcoin for example. The smallest unit of bitcoin is 1 Satoshi (that is, 0.00000001 bitcoins), and we usually treat the amount of less than a few hundred Satoshis as dust. In other words, dust is a small part of the transaction or amount, which is usually not worth the transaction because the transaction costs are often higher than their value. Exchanges often refer to the tiny amount of tokens that are“Stuck” and can not be traded as dust.

Most people don’t even notice the dust in their wallets and rarely care where it comes from. In the past, you could completely ignore the dust in your wallet, but now, with the emergence of dust attacks, you need to be vigilant.

Definition of dust attack

A dusting attack is an attack on a cryptocurrency wallet that sends tiny amounts of cryptocurrency (known as “dust”) to that wallet in order to uncover the identity of the wallet’s owner. Information can then be used to obstruct receiving legitimate payments or phishing scams.

When you use bitcoin to pay for something, one or more addresses (UTXOs) are selected that most closely match the amount due and you receive an output UTXO with your change. By dusting, hackers or scammers send very small amounts of cryptocurrency (dust) to a large number of addresses. If you get dust, you will have a UTXO of very little value in your wallet. When you spend from your wallet, the attacker observes when the dust UTXO is picked up. If it is, they take note of all the other UTXOs and the addresses they go to. When these entities study transaction patterns long enough, they can eventually identify all the addresses associated with your wallet, which means they can figure out how much cryptocurrency you own. If your account is of interest (you have large sums), they can be sure it belongs to you, which could make you the target of anything from scams and phishing campaigns to cyber extortion threats.

Ways to Prevent Dust Attacks

To identify if a hacker is attempting a dust attack, you can look at the cryptocurrency you receive in your wallet. Therefore, the most important thing you can do to protect yourself from dust attack is to never click on a link sent from an unknown address!

In addition, individuals can take measures to protect themselves from dust attacks, of course, these measures can prevent some other attacks.

Remain anonymous

None of this implies that cryptocurrency trading or use is dangerous. However, as a reminder, while transactions can be anonymous (when actually making the transaction, you may reveal information about the person you are trying to complete the transaction with, which can then be associated with your wallet), they are not private. Unfortunately, scammers and hackers are leveraging very public blockchain technology to identify the people behind cryptocurrency transactions.

The good news is that knowledge is power. You can protect yourself from malicious entities and remain anonymous by being aware of attacks like dusting and taking precautions. Doing so will better protect you and your property, while helping to ensure you don’t fall victim to phishing or cyber extortion threats.

Protect your cryptocurrency from malicious dusting and airdrop attacks

Since cryptocurrency transaction information is public knowledge, it is important to protect yourself, your assets, and anonymity. In addition to ensuring anti-spam and anti-virus protection for your wallet, consider the following steps:

Never reveal private information

If a website or other airdrop entity — wants more than your wallet address in exchange for tokens or coins, that’s a red flag. As with providing fiat bank account login data, distribute your cryptocurrency information with care.

If you think you’ve been dusted, don’t move the dust

Look for wallet apps that allow you to “tag” small, unknown deposits in your wallet to prevent them from being used for other transactions.

Monitor your balance 24/7

If wayward satoshis pop up in your crypto wallet, you’ve probably settled the dust. It’s a good idea to find a wallet app with push notifications that will tell you when new funds are received.