Inside the cryptocurrency scam vortex
0Reported today on The Verge
For the full article visit: https://www.theverge.com/22522380/cryptocurrency-scams-hacks-bitcoin
Reported today in The Verge.
Inside the cryptocurrency scam vortex
On May 22nd, a crypto finance project called DeFi100 posted a message to its website: "We scammed you guys and you can't do shit about it. HA HA. All you moon bois have been scammed and you can't do shit about it."
Screenshots of the message immediately went viral on crypto Twitter (always anarchic, easily risible). A popular anonymous crypto-tracking Twitter account called Mr. Whale estimated that DeFi100 had run off with $32 million. Cryptocurrency news outlets, as well as Yahoo Finance, ran with the number. The project owners denied any foul play, and it soon became clear the message was a website hack rather than a serious warning - but by then, it was too late. Panic had set in, and the price of the underlying coin was in free fall.
"We never stole any funds," a representative for the project told The Verge. "DeFi100 was a very small project, and we were not holding any investors' funds, so there are no questions of scamming people or running away with their funds."
DeFi100's problems are a small part of the picture, but they're a reminder of the dangers of the ongoing crypto boom. Despite billions of dollars pouring into the space in recent months, there's still little recourse when investments turn out to be scams. Most importantly, the radical decentralization of the blockchain means there is simply no way to get your money back - and few assurances that an unproven vendor will keep their promises once the transaction goes through. The result is a new gold rush in crypto scams, as speculators seek ever more obscure opportunities and riskier bets.
The DeFi100 project's website is now back online, but rumors persist about what actually happened. Certik, a popular blockchain security leaderboard