Approval Phishing Scams on the Rise in the Crypto Space
Approval phishing scams are becoming increasingly prevalent in the cryptocurrency industry, resulting in approximately $375 million being stolen so far this year, according to Chainalysis.
Malicious Activity by Approval Phishing Scammers
The data is derived from Chainalysis’ upcoming report on crypto crime for 2024, which defines approval phishing as a scheme where scammers deceive users into signing a malicious blockchain transaction that grants approval to spend specific tokens from the victim’s wallet. This access allows scammers to drain the victim’s tokens at will.
Data Reveals Over $1 Billion Lost to Approval Phishing Scams
Chainalysis reports that approval phishing has surpassed traditional “pig butchering scams” and scammers are now targeting specific victims, building relationships with them, and using tactics similar to romance scams. The data shows that victims of the collected sample have lost an estimated $1 billion since May 2021 due to approval phishing scams.
Recommendations for Future Prevention
Chainalysis suggests that exchange compliance teams should monitor transactions more closely to detect approval phishing scams in real-time. Additionally, educating users not to sign approval transactions unless they fully trust the other party can help prevent these types of scams.
Hot Take: Explosive Growth in Approval Phishing Scams
The rise of approval phishing scams in the crypto space is alarming, with nearly $375 million already stolen this year alone. These scams involve tricking users into signing malicious transactions, granting scammers access to their tokens. Victims have lost over $1 billion since May 2021 due to these scams. To combat this trend, it is crucial for exchange compliance teams to be vigilant and for users to exercise caution when signing approval transactions. Awareness and proactive measures are essential in preventing further financial losses in the crypto industry.
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