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₹1000 Crore Crypto Scam: Scammers Pose as Fake Exchanges to Scam Indian Users

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VOC, Voice of Crypto, Bitcoin, BTC

In India, cryptocurrency is widely adopted as the country has one of the largest crypto traders in the world. However, many Indians still fall victim to crypto scams. According to researchers at CloudSek, a security firm, there is a new wave of scam in India known as CoinEgg. Many users of CoinEgg in the country have been defrauded of about ₹1,000 crore– ₹10 billion.

In a blog post by the security firm, they said,

We discovered an on-going malicious scheme involving multiple payment gateway domains and Android-based applications, used to lure unsuspecting individuals into a mass gambling scam.

How CoinEgg Scam Works

According to CloudSek’s researchers, fake domains used in impersonating crypto exchange platforms were created by the scammers. The domains had ‘CloudEgg’ in them, with the scamming divided into 7 stages. According to the post,

The sites are designed to replicate the official website’s dashboard and user experience.

The creation of fake domains is the first stage with the second stage where the scammers used a fake female profile in social media to ensnare potential victims. Additionally, the fake female account will cunningly talk the victim into investing and trading in the fake crypto platform.

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According to the security firm;

The profile also shares USD 100-dollar credit, as a gift to a particular crypto exchange, which in this case is a duplicate of a legitimate crypto exchange.

With this free sign-up bonus, the victims are more likely to sign up on the fake crypto trading platform. Also, after signing up, they begin to trade according to the scammers instructions. In the long run, when they see that they are beginning to make profits from the bonus they were given, they invest higher amounts.

Read more about indian crypto here

As soon as the victim invests money into the trading platform, their account gets frozen. They become unable to withdraw but their profit and capital. Interestingly, the scam is not over as it is yet to get to the seventh stage.

In the last stage of the scam, victims that have been scammed by the fake crypto trading platform go to complain on other platforms. When this happens, fake accounts are created by the scammers to pose as invigilators.

To retrieve the frozen assets, they request victims to provide confidential information such as ID cards and bank details via email. These details are then used to perpetrate other nefarious activities, the CloudSek researchers said.

According to CloudSek’s chief executive, Rahul Sasi, cyber crime cells, internet service providers and crypto trading platforms have to work hand in hand to avoid fraudulent activities online.

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