Crypto giveaway scams and how to spot them | by Coinbase | The Coinbase Blog

by thomas hauer, jr.Cryptocurrency giveaway scams have been a problem for those involved in the crypto community since the last big bull run in late 2017. Whether you are an experienced investor or just starting to get their feet wet in the crypto space, we encourage all of our clients to educate themselves on current cryptocurrency scams and how to identify them. In this article, we’ll cover an increasingly common technique used by online scammers: the gift scam.

Simply put, giveaway scams are a form of social engineering where a scammer attempts to trick a cryptocurrency investor into believing that a major cryptocurrency exchange or celebrity is hosting a giveaway. The catch here is that to enter the draw, you first need to send a certain amount of cryptocurrency to a draw address so that you can verify your wallet address and receive your share of the draw. however, because cryptocurrency transactions are irreversible, once the victim sends money to the scammer’s address, no one can do anything to get it back and the scammer has made a profit.

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Now that you understand the gist of giveaway scams, we’d like to make it very clear that even when Coinbase occasionally does giveaways, we will never ask you to send crypto in order to receive crypto. Furthermore, you can earn cryptocurrencies by learning about them through Coinbase. With that said, let’s move on to some recent trends.

recent gift scam trends

To help you recognize the signs of a giveaway scam, we’ve provided some examples of the most common giveaway scam trends being used to target cryptocurrency investors.

coinbase twitter impersonations

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In the screenshot below, we have a twitter account posing as coinbase responding to a legitimate coinbase tweet with an image promoting a 5000 btc giveaway scam.

The link in this image takes you to a web page that will ask you to verify your bitcoin address by sending between 0.1 and 10 btc to the scammer’s gift address. according to the scammer’s website, they would refund x10 your payment. this all sounds great but its 100% scam and you will get 0 btc back!

celebrity twitter impersonations

In this example, we have a very normal looking twitter account replying to a tweet made by senator bernie sanders. the answer here is to thank elon musk and share an image that appears to be a tweet from elon musk about a bitcoin and ethereum giveaway hosted by tesla. actually this image was doctored to make it look like elon musk made this tweet and it is purely fabricated by a scammer.

By navigating to the link in the scammer’s image, we landed on a webpage that appears to be a medium-sized blog post. inside the post there are two “official” links that lead to “free” bitcoin and ethereum. Both links lead to scam giveaway addresses that cannot be trusted, no matter how great and well-designed the web page looks.

youtube live streams

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This is a fairly new technique that scammers have been using to perpetuate their crypto giveaway scams. In this example, the scammer will create a YouTube video using older video footage of cryptocurrency exchange CEOs and overlay the video with some details about an alleged gift. they’ll also set the video up as a live stream to make it look like something is happening now, further enticing viewers to enter the giveaway right away. In the video description, there is often an “official” giveaway address or a link to a web page that contains the giveaway address. In addition, the scammer will lure fake viewers into the video to make it look like they have thousands of viewers at the same time. Don’t fall for this scam, it’s a trap and you won’t get any free btc!

giveaway scam email

In our final example, we have an attempt to promote an email giveaway scam. In the email, the scammer attempts to convince the recipient that Coinbase is hosting a giveaway to celebrate a user registration milestone. As mentioned above, Coinbase occasionally does giveaways, but will never ask you to send crypto to receive it. Please make sure the email is from a coinbase email before going through the signup process.

protect your investment and that of your fellow investors

Now that you’ve learned about the latest techniques gift scammers use, there are two simple rules we’d like you to remember that should help you avoid scams like these in the future:

  1. If it sounds too good to be true, it almost certainly is.
  2. Think twice before sending your funds. all cryptocurrency transactions are irreversible and you will not be able to get your money back.

Finally, if you come across any giveaway scams like the ones shown above, please take a moment to protect the broader cryptocurrency community by reporting the scam to coinbase or directly to twitter, youtube or google. For your reference, we provide information on how to report each entity below.

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