Ethereum’s transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS) is without a doubt the protocol’s most significant upgrade since its inception. Widely referred to as “The Merge”, this is also one of the most anticipated events in the cryptocurrency space in 2022.
The merger is scheduled to take place in September 2022 on a “soft” schedule and barring unforeseen circumstances.
For everything there is to know about it, please take a look at our detailed article to this topic.
The closer we get to that date, the more bad actors are trying to take advantage of this and scam people out of their money. Here are a few very popular types of scams that everyone should be aware of, especially as The Merge approaches.
phishing scam
Phishing scams are one of the oldest tricks in the book, and with an event as hyped as The Merge, you can expect them to skyrocket.
For those who don’t know, phishing scams attempt to steal funds from your wallets by providing fake but incredibly well-crafted prompts that look very similar to the real thing. The most common example is a phishing email or other type of message you receive online encouraging you to click links that redirect to fake websites. In most cases, they would also ask you to either enter your seed phrase or sign wallet permissions, which would allow the hacker to essentially siphon off your funds.
Others might ask you to unknowingly install some type of software that turns out to be malware and infects your computer, giving scammers access to your files.
As a general rule of thumb, especially with regard to opening emails from unknown senders, you should:
- Never share personal information or passwords (including seed phrases) with anyone
- Immediately delete emails from unknown senders
- Never open an attachment or link from an email address you don’t recognize
Furthermore, you should be aware that scammers are becoming more and more sophisticated to get their hands on your funds. Therefore, staying extra vigilant is crucial.
airdrop scam
Airdrop scams are also likely to be rampant as we near The Merge dates. Knowing that:
There are no official airdrops confirmed by the Ethereum Foundation.
The way these scams work is that the bad actors would send some tokens to your wallet. From there, some wallets will likely represent their value, and you may be surprised to see that you have a token worth thousands like you’ve never seen before.
This is where the scam starts as you will likely be asked to log in with your Ethereum wallet and approve a transaction while attempting to claim your airdrop. This essentially gives the scammer control of your keys.
There is another alternative to this, which would require you to sign a transaction that actually transfers the money to the scammer’s account.
ETH2 token scam
Just as there are no official airdrops confirmed by the Ethereum Foundation, there is also no ETH2 token. There will also never be another token introduced with The Merge.
Anyone who gets you into investing, trading, mining, staking or whatever – in something like that – is trying to scam you.
As we explained in our detailed article, The Merge does not require users to exchange their ETH.
Of course, one should also keep in mind that there are legitimate derivative tokens that can represent staked ETH. That is the case when ETH is staked on Lido’s platform called stETH. Binance and Coinbase also have their alternatives.
This particular scam is very closely related to the next one on our list…
support fraud
Support scams are very common in the cryptocurrency industry and, similar to most scams, target people who are not crypto-native and lack sufficient knowledge of the industry.
For example, there are already cases of people being contacted by Twitter accounts called “Ethereum Support”. They would fish for some details, which often include private keys, seed phrases, or passwords. Sometimes they also require the user to grant them remote access to their computer, and so on. The goal is pretty obvious – to free you from your wealth.
As some important points here you should:
- Never share your passwords or seed phrases with anyone.
- Never give anyone remote access to your computer.
- Never communicate with anyone outside of established channels.
As a general rule of thumb, no support team will ever extend first contact and they certainly won’t ask for private details, especially seed phrases or passwords.
Mining Pool Scam
Ethereum currently uses the proof-of-work consensus algorithm, which implies that ETH is mined in the same way as BTC, for example. Hence, it is highly likely that there will be many bad actors trying to exploit this and cheat unsuspecting victims out of their funds through mining pool scams.
For example, the scammers can make claims and keep in touch with the victim for as long as it takes and they would try to convince them that they should join an ETH mining pool. If the user sends a small amount of money, they will probably even make some profits – this is done to lure them into sending the large amount. Once this is done, the scammers will likely send the money to an unknown address that will never be heard from again.
As an important point to remember here, you should:
- Note that most of these offers are not legitimate. If they were, they would have been mainstream by now and you would have heard of them.
- Do thorough research on liquidity pools, staking and mining before investing your money.
- Be extremely cautious when someone contacts you to monetize your crypto.
Conclusion
To sum it up, it’s important to understand that such big events often attract a crowd of bad actors. This will surely increase fraud attempts, and underestimating how creative and sophisticated hackers are is the biggest mistake you can make.
In addition to the above, it is highly advisable that you employ strict security management for your crypto in general.
These 9 tips for securing your crypto wallets are a must.
You should also establish these habits as soon as possible. There is a possible saying in the industry:
“Protect your crypto like it’s worth $100M because one day it could be.”
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