An individual fell victim to a phishing attack, losing millions of dollars worth of funds in decentralized finance (DeFi). This error is prevalent among users, impacting even experienced investors using cryptocurrencies that enable such attacks.
In the latest incident, the Ethereum address ‘0xAA1582084c4f588eF9BE86F5eA1a919F86A3eE57’ lost 12,083.6 spEWTH, equivalent to $32.33 million. The transaction to two addresses labeled “Fake Phishing” was recorded by Ethereum’s blockchain on September 28 at 6:15 a.m. UTC.
Upon consulting the Arkham Intelligence database, it was indicated that the address likely belongs to Shixing Mao, also known as DiscusFish in the cryptocurrency world. The address still holds tokens valued at $8.25 million, with $2.85 million in DAI stablecoin.
Shixing Mao, a seasoned crypto executive and co-founder of F2Pool and Cobo, serves as another example highlighting how even experts can fall prey to such attacks. This emphasizes the necessity for universal solutions to prevent similar occurrences.
1 in 7 crypto investors were victims of Phishing
A study conducted by WalletConnect unveiled that around one in seven cryptocurrency users have suffered losses due to phishing attacks. According to the survey, 14.4% of respondents admitted to losing crypto as a result of phishing scams.
Instances of significant losses by crypto investors have been reported on X, a platform highlighting incidents of malicious contract interactions. Notable cases include a $4.69 million loss of Pendle (PENDLE) re-staking tokens and a $55 million DAI loss to a phishing attack, emphasizing the need for users to exercise caution while transacting.
Various cases of phishing activities within the TON ecosystem and concerns around Tether freezing suspicious activities have been documented on Finbold. These incidents shed light on the broader issue plaguing users globally, urging the adoption of solutions to combat such threats.
Nevertheless, advancements in technology are addressing these challenges by incorporating security measures to safeguard users against phishing attacks and wallet drains on DeFi platforms.
How to prevent phishing attacks and wallet drains on DeFi?
Most phishing attacks result from human errors exploited in different ways like connecting wallets to malicious applications or signing malicious transactions. To avoid falling victim to such attacks, users should verify websites and understand the actions they are authorizing.
Implementing easily readable transaction signing mechanisms in wallets and protocols can assist users in comprehending the transactions, thereby reducing the risk of phishing attacks. Additionally, advanced technologies are introducing built-in security features aimed at preventing human errors and enhancing overall security.
Native assets for enhanced security
Popular blockchains such as Ethereum (ETH) and others utilize a model where tokens operate differently from native assets, involving smart contract calls that necessitate special permissions to transfer funds. On the other hand, chains like Cardano (ADA) and others adopt a native-asset token model, where tokens behave as native assets within the protocol, ensuring an added layer of security by requiring users to authorize each transaction.
Developers are increasingly focusing on security concerns, phishing attacks, and token models to enhance user safety. As the crypto market advances, investors will need to choose between existing standards and newer technologies, highlighting the evolving landscape of cryptocurrency.
The original article can be found at Finbold.