Scam Artists Used Ethereum 2.0 Merge To Steal $1,200,000 in Crypto, According to Chainalysis

Blockchain analysis firm Chainalysis says scam artists stole $1.2 million worth of Ethereum (ETH) during the project’s merge to proof-of-stake.

The firm notes in a new blog post that merge-related scams took in the haul shortly before, during and after the September 15th event.

The merge scams resembled other classic frauds, explains Chainalysis.

“Most Merge scams functioned similarly to the classic trust trade scam, in which the fraudster tells victims to send them some amount of cryptocurrency to receive more in return (typically double the victim’s initial payment), often impersonating celebrities to do so. In this case, scammers told victims they should send in cryptocurrency in order to “upgrade” to the new Ethereum blockchain and receive funds in return.”

Source: Chainalysis

The firm notes merge-related scams had an 83% success rate on September 15th and a 100% success rate on some of the days surrounding the event. The US and India engaged with this specific type of fraud more than any other countries.

Explains Chainalysis,

“Looking at all the countries in our dataset, it is interesting to note that Merge scams were more likely than non-Merge scams to target users in countries with higher GDPs [gross domestic products], by a small but noticeable margin. It’s possible that Merge scammers purposely targeted users in wealthier countries under the assumption they’d be more likely to invest more in the scam, but it’s unclear why Merge scammers would be more likely to do this (or do it successfully) than other scammers in the Ethereum ecosystem.”

Source: Chainalysis

Chainalysis says that times of industry change can be ripe for fraudsters looking to capitalize on potential investor confusion. The firm claims “the spike in Merge-related scamming makes clear that the industry must work to educate users on what things like the Merge mean for them, as well as which common scam types to avoid generally.”

Don’t Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox

Check Price Action

Follow us on Twitter, Facebook and Telegram

Surf The Daily Hodl Mix

Check Latest News Headlines


Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

Featured Image: Shutterstock/Mia Stendal/VECTORY_NT

Leave a Reply

Your email address will not be published. Required fields are marked *