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Tech Entrepreneur Falls Victim to Cryptocurrency Scam, Loses $125K

Tech Entrepreneur Falls Victim to Cryptocurrency Scam, Loses $125K

 By Charles Joseph | Cybersecurity Researcher
 Published on January 5th, 2024

Bill Lou, the co-founder of the emerging digital wallet service Nest Wallet, fell prey to a sophisticated cryptocurrency scam, resulting in a substantial loss of $125,000 in staked Ethereum (stEth).

In what appears to be a well-orchestrated phishing attack, Lou was enticed by an article guiding readers to participate in a lucrative $LFG airdrop. The article led to a counterfeit website, a mirror of (the legitimate site), which siphoned off 52 stEth from his account.

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The incident saw Lou, an advocate for enhanced wallet security, inadvertently bypass his own service, Nest Wallet, in favor of Metamask. He later expressed regret, stating that Nest Wallet’s security measures could have potentially thwarted the scam.

On his social media profile, where the transaction link remains visible, Lou voiced his frustration, condemning both Metamask and his own lapse in judgment. “FCK METAMASK, FCK MY OWN STUPIDITY,” he wrote, reflecting on his decision to engage in the airdrop late at night, a choice he attributes to greed.

Cryptocurrency airdrops, often used as a marketing strategy to distribute tokens to wallet holders, can be a double-edged sword, attracting not only enthusiasts but also opportunistic scammers.

Further deepening the narrative, Lou has teamed up with Hackers Residue, a cybersecurity group, to investigate the breach. Their findings suggest a larger operation, with the scammer amassing a total of 66 Eth, including 14 Eth from other victims, valued at approximately $31K as of January 5th, 2024.

As of the latest update, the stolen funds have been reportedly consolidated into a single wallet, details of which Lou shared publicly, possibly as part of a broader effort to track down the perpetrator.

"Amateurs hack systems, professionals hack people."
-- Bruce Schneier, a renown computer security professional
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