Phishing Attacks Accelerate as Crypto Regains Value, Over $41M Lost in October

As crypto regains its value and even more valuable tokens are launched, attacks against individual wallets are accelerating. Only in the first two

Cryptocurrency scams are accelerating as the value of digital assets rises and new tokens are launched rapidly. According to recent reports, phishing attacks have already resulted in staggering losses of over $41 million in the first two weeks of October.

These scams often target individual wallets, and the latest figures from Certik show a concerning increase in all types of attacks during Q3. As more people venture into the world of crypto, wallet phishing and malicious links are becoming prevalent threats to be aware of.

In the last 24 hours, another victim has lost a significant amount of $1.57 million after signing a "permit" phishing signature. This incident highlights the urgency to stay vigilant and be cautious of any suspicious links or requests to sign transactions from unknown sources.

According to DefiHackLabs, October has seen eight total exploits, ranging in attack value from $100K to $2.4M, targeting individual wallets. While these sums may seem small compared to the large-scale exchange exploits we've seen in recent weeks, the ubiquity of these attacks and their impact on retail traders make phishing a major threat in Web3.

These losses are also proving harder to recover, as attackers are moving the funds through DEX or mixers to complicate tracking efforts. Phishing hacks are adding to the tally of losses from more elaborate attacks, such as the validator address hacks and MEV exploits.

Typically, phishing attacks will ask for actions to be signed through the user's wallet, such as approving a contract or signing another type of transfer or permission. Another common tactic involves fake phishing tokens targeting wallets with crypto balances in an attempt to redirect funds to a fake address. Permit phishing is particularly damaging, as it can gain permission to move multiple tokens. We saw an example of this just days ago, where a wallet was hacked for $1.4M in meme tokens.

While these attacks are not entirely new, they are accelerating in October due to the massive inflow of users into crypto. Most of these attacks are centered around Ethereum, being one of the most liquid chains with well-understood smart contracts. Attackers often use open-source contracts to generate malicious links or even build specific smart contracts that look realistic to carry out these scams.

Hacked X accounts deliver fake links

Since the crypto community is largely based on X, these accounts are vulnerable to being hacked, which can pose a serious risk to users, especially in October.

With the meme token frenzy coinciding with the general market recovery, all assets are being targeted, from BTC and blue chips down to the latest new meme token that promises to grow 1,000 times or more.

One common attack vector involves hacked X handles, which could belong to influencers or meme token accounts. Instead of signing to buy a token, users might find their wallets emptied. Even pressing ‘connect wallet’ to a link from social media can lead to losing all the assets within that wallet. Sometimes, a malicious link will be disguised as a token recovery tool or even a protection against hacks.

Links may also appear through Google ads, inviting users to join new chains. In this case, the scam website will ask the user to connect a wallet - and in that case, it's best to only risk the test with a new empty wallet.

Finally, promising airdrops or point farming can lull users into putting their skepticism to sleep and granting permission to their wallets. One of the latest X handles to be hacked belonged to the SPX6900 hot meme token, exposing potential buyers to a malicious address. Sometimes, links are hidden in what appear to be harmless offers or download links. As more newcomers flock to meme tokens, keeping their wallets ready for trading at all times, we can expect to see more of these incidents.

Scam advertising on social media, as well as scam replies, often carry malicious links. Additionally, be wary of compromised Discord servers or expired invitations, and never install software or open calls to do so, as they may be designed to drain wallets or compromise private keys.