Fraudulent Cryptocurrency Apps Network on YouTube: WithSecure™ Reveals the Scams

Fraudulent Cryptocurrency Apps Network on YouTube: WithSecure™ Reveals the Scams

WithSecure™, formerly known as F-Secure Business, has uncovered a fraudulent network of cryptocurrency investment schemes that operate through web-based apps posing as Tether (USDT). Researchers from the cybersecurity company have released a report detailing the operations of this network that consists of thousands of videos, some of which received inauthentic engagement from hundreds of YouTube channels managed by a small group of scammers using Telegram for communication and running operations. The report offers insight into the anatomy of the videos and apps behind these scams, analyses two associated scam apps in detail, explores the #usdtmining YouTube hashtag, and presents recommendations for YouTube.

Using Automation to Legitimize Fraudulent Apps

The group of scammers, which researchers estimate to have around 30 members, uses automation to copy/paste comments for the videos in an attempt to legitimize the fraudulent apps to potential victims. While the researchers found over 700 URLs hosting these fraudulent web-apps served by the network, an analysis of associated cryptocurrency wallets implicated the possible involvement of thousands more.

Targeting Cryptocurrency Investors with Opportunistic Approach

“This network seems to be targeting existing cryptocurrency investors with low-quality videos in different languages without localizing them to reach different regions, so I’d say it’s a pretty opportunistic approach,” said WithSecure™ Intelligence Researcher Andy Patel. “Typically, this results in a large volume of small transactions. But as that volume increases, so do the odds of them getting lucky and finding someone able and willing to invest more substantial amounts.”

Falling Prey to Crypto Scams

Cryptocurrency scams aimed at defrauding potential investors have become a significant problem on the internet, particularly social media. The US Federal Trade Commission reports that between the beginning of 2021 and June 2022, 46,000 people have reported losing over a billion USD in crypto to scams, with nearly half stating it started on a social media platform.

Limited Profit but Easy Amplification

WithSecure™ researchers estimate that the fraudulent apps discovered generated just over 100,000 USD in revenue from approximately 900 victims. “I do not believe these particular scams are very profitable. However, they’ve clearly figured out how to game YouTube’s recommendation algorithms by using a fairly straightforward approach,” explained Patel. “Moderating social media content is a huge challenge for platforms, but the successful amplification of this content using pretty simple, well-known techniques makes me think that more could be done to protect people from these scams.”

Staying Safe from Crypto Scams

Given the rise of crypto scams, it is crucial for potential investors to be aware of the risks and to take steps to protect themselves. It is important to verify the legitimacy of any investment opportunity, avoid rushing into decisions, and never transfer money without fully understanding the details of the transaction.

WithSecure™ has taken the first step by revealing the operations of this fraudulent network, and it is now up to the cryptocurrency community, investors, and platforms to take necessary measures to curb the growth of such scams.

 

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