Attackers are Now Leveraging Play-to-Earn Games to Drain Crypto Wallets

The cryptosphere has gotten bigger since Bitcoin’s inception in 2009. Many people who didn’t even know what a crypto asset is– now hold digital assets in their virtual wallets. Over 22,000 digital currencies are circulating in the market, according to the CoinMarketCap data. Gary Gensler, the Securities, and Exchange Commission (SEC) chair, believes most of them will fail. This decentralized realm has also attracted several malicious actors throughout the years.

FBI Highlights Latest Crypto Scam in The Market

The Federal Bureau of Investigation (FBI) recently highlighted rising crypto frauds associated with play-to-earn gaming in a Public Service Announcement (PSA). A person will likely lure a potential victim into playing a fake crypto game, asking them to create and connect a virtual wallet to the app. Moreover, user deposits are most likely act like ‘multipliers’ for ‘in-game rewards– the more, the better.

The attacker will actively interact with the user until he keeps depositing the money, then vanishes as soon as the victim halts the transactions. The agency also delivers some tips to keep the attackers at bay in the PSA, including isolation of crypto holdings via a unique wallet, using a blockchain explorer to trace the transactions, and more.

In June 2023, the agency raised awareness regarding pig butchering frauds, where an attacker establishes a love interest with the victim just to leave them holding their bags. According to the complaints, the attack delivered a financial and mental blow.

Web3 space has attracted huge investments even though it is still in its infancy. Moreover, integrating crypto assets has made it more attractive to illicit actors. CertiK, a web3 security company, highlighted in their report that hackers stole $3.7 Billion from web3 protocols last year.

According to the Web3 Security Report, March 2022 saw $714 Million vanishing from the sector, the highest in any month. Meanwhile, October 2022 witnessed the most attacks–70 hacks–in a month. Moreover, exit scams dominated 2022, with a total of 316 malicious acts throughout the year.

The malevolent acts in space have led nations to put more restrictions on the sector. Australia requires stablecoin issuers to hold the country’s fiat currency or any other foreign currency in an Australian bank. Exchanges and custodian wallet providers in the United Kingdom (UK) must comply with the Office of Financial Sanctions Implementation (OFSI).

Digital assets are entering the mainstream via different means, including play-to-earn games, NFTs, communities, and more. Several appear genuine however, they may eventually lead user funds to undesired wallets. A right investment can take you places, but a wrong one can close the windows inviting an unpleasant aftermath..

Disclaimer

The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.

Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.