Cold Wallet Scam Exposed By Prominent Crypto Trader

The Wolf of All Streets, a renowned cryp­to trad­er, cau­tioned his 916,700 fol­low­ers to stay vig­i­lant, empha­siz­ing that both hot and cold wal­lets can be sus­cep­ti­ble to scams.

“I have been speak­ing with one of my fol­low­ers here, who shared that he was hacked this morn­ing on a Ledger scam,” he stated.

Crypto Trader Urges Followers to Stay Vigilant Against Cold Wallet Scams

The Wolf of all Streets, a cryp­to trad­er, rec­om­mends exer­cis­ing cau­tion when nav­i­gat­ing and stor­ing cryp­to in the cur­rent high­ly volatile market.

He dis­closed that he had a con­ver­sa­tion with a close friend, some­one vig­i­lant about secu­ri­ty. He explained that this per­son encoun­tered a prob­lem with his Nano ‑S hard wal­let:

“Got hit with a 503 HTTP API error when it went to syn­chro­nize, which in and of itself ter­ri­fied me.  Then I reached out to Ledger Sup­port on Twit­ter and with­in sec­onds I had the CTO reach­ing out via DM.”

How­ev­er, some­one posed to be the chief tech­nol­o­gy offi­cer (CTO) of the com­pa­ny. Fur­ther­more, they walked the vic­tim through steps to sup­pos­ed­ly fix the issue which result­ed in his wal­let being “com­plete­ly drained.”

“I even asked him about why it was required and he men­tioned it was end to end encrypt­ed and a require­ment to sync.  Mov­ing too quick­ly and obvi­ous­ly not think­ing clear­ly, I gave it and with­in min­utes real­ized my account was com­plete­ly drained.”

Learn more: What Is a Rug Pull? A Guide to the Web3 Scam

Sophisticated Scams on the Rise in Recent Times

How­ev­er, whether it’s a cold wal­let or hot wal­let, investors should exer­cise utmost caution. 

It was recent­ly report­ed that with the onset of arti­fi­cial intel­li­gence (AI) now has the abil­i­ty to assist hack­ers in drain­ing vic­tims wal­lets. On May 11, BeIn­Cryp­to report­ed that Google’s Bard could also iden­ti­fy smart con­tract bugs that crim­i­nals can use to steal cryp­to or money. 

Fur­ther­more, espe­cial­ly before engag­ing in con­ver­sa­tions about instruc­tions or inputting infor­ma­tion into their wallets.

On July 23, cryp­to pay­ments ser­vice provider Alphapo had over $23 mil­lion worth of cryp­to assets stolen from its hot wallets. 

Peck­Shield, a blockchain secu­ri­ty firm, detailed the stolen funds. These com­prised 6.074 mil­lion USDT, $108,000 USDC, 100.2M FTN, 430K TFL, 2.5K ETH, and 1,700 DAI.

Learn more: 15 Most Com­mon Cryp­to Scams To Look Out For