In recent years, airdrops have become a widely used marketing strategy whereby cryptocurrency projects distribute their tokens to potential users and investors.
However, as the popularity of airdrops has grown, the number of airdrop hacks has also increased significantly.
This article will discuss some Airdrop Hack Techniques and Prevention to Protect Your Assets, their prevention, typical characteristics, and, most importantly, how to protect yourself and your assets.
What Are Airdrop Hacks?
Airdrops are usually marketing promotions that encourage crypto and trading enthusiasts to support a project, for which they are then rewarded with cryptocurrencies, NFTs, or other digital assets.
Airdrop hacks are centered around fake airdrops, which a team or group of airdrop scammers heavily endorse. Still, they also attempt to exploit investors by encouraging them to participate in incentive programs. These programs are usually fronts for scammers to gain access to their wallets, draining them without the victim realizing it until it is too late.
How Does Airdrop Hack Work?
Airdrops involve the free distribution of tokens to users within cryptocurrency platforms. It is often done legitimately on specific crypto platforms and within the blockchain sector to draw attention to particular projects and build interest in new projects.
But, as with many areas of the cryptocurrency landscape, specific individuals look to exploit regions for their gain, such as with airdrop crypto scams.
They will look to set up fraudulent schemes, fake websites, and profiles and carry out fake token distributions. Sharing such content tends to happen on social media platforms like X to reach a wider audience.
The fake websites and profiles will look authentic at first glance and, in many cases, almost identical to the original. There will likely be requests for the user’s private key or seed phrase from here. Once these details are submitted to claim the ‘airdrop,’ they will receive an error message, and the contents of their wallets will be lost.
Alternatively, with airdrop hacks, victims might find that they have new tokens in their wallets instead. Hackers often send fraudulent cryptocurrencies with messages like “airdrop winnings.”
These lure individuals to phishing sites, where they are prompted to connect their wallets and sign a malicious smart contract. Then, their wallet becomes susceptible to further hacking, so you must never connect your wallet or grant unverified access.
What Do Airdrop Hacks Look Like?
Airdrop hacks are phishing in that they take your sensitive data and information. This means they can take on several different appearances and forms to do this. One of the most common ways airdrop hacks end up in front of unsuspecting victims is through paid ads on social platforms.
Like most social media platforms, users are shown ads based on their interests. So, if users show interest in crypto and trading, they may be shown ads for fraudulent airdrops more regularly, enticing them into going through with the hack. In December 2023, a report found that a crypto hacker being promoted on X and Google Search stole over $59 million from thousands of victims over nine months.
It’s believed that ads on X promoting hacks, such as the airdrop crypto hack, are increasing in volume. Elon Musk announced last year that, since he took over, X has lost just over half of its advertising revenue.
Common Airdrop Hacks You Should Know
1. The Phishing Airdrop Hack
Hackers create a fake campaign requiring participants to enter sensitive information on a fraudulent website. Example: A hacker might advertise an airdrop for a popular token but direct users to a website where their private keys are stolen.
2. The Deposit Hack
This hack asks users to deposit a certain amount of cryptocurrency to receive a more significant number of airdropped tokens. Example: A hacker promises 100 new tokens for every 1 ETH deposited but disappears once the deposit is made.
3. The Pump and Dump Scheme
Here, hackers excite an airdrop to inflate the price of a worthless token, only to sell off their holdings once the price peaks, causing the value to plummet. Example: A group advertises a high-value token airdrop, driving up demand and price, then sells its stake at the peak before the crash.
4. Approval Hack
Participants are asked to approve a smart contract that ostensibly only allows the distribution of the airdropped tokens but permits the scammers to access and drain the participant’s wallet. Example: A seemingly benign smart contract airdrop enables hackers to withdraw all tokens from a user’s wallet once approved.
5. Impersonation Hack
Hackers impersonate legitimate projects or individuals to offer fake airdrops, often using social media to spread fraudulent offers. Example: A hacker uses a fake Twitter account, mimicking a well-known crypto figure, to announce a non-existent airdrop.
6. Malware Airdrops Hack
Some airdrops require downloading a new wallet or malware software to steal your information. Example: A new token airdrop that requires downloading a unique wallet, which turns out to be malware that compromises the user’s computer.
Warning: Trustworthy projects will NEVER require your Private Keys or Recovery Phrase. Refrain from sharing this information with anyone or any site to prevent potential loss of wallet access or unauthorized movement of your digital assets.
Your Private Keys or Recovery Phrases are required when logging into your self-custody wallet via a new web browser or mobile app. There’s no need to input this information when logging in or conducting transactions on any NFT marketplace.
Protecting yourself and your crypto assets
- Always try to rely primarily on official sources. Use platforms only after carefully checking the links.
- Any “airdrop” that requires the user to enter private keys or a seed phrase is an outright hack. Such information should be known only to you and stored offline.
- Always double-check the links on CoinMarketCap. Phishing sites only get through there in some cases. If a scam came across, this is an exception to the rule.
- Even if the airdrop does not seem fake to you, but they ask you to make some contribution, this is most likely also a hack;
Conclusion
Even experienced crypto investors can get tricked by airdrop hack because it’s hard to tell the real from the fake — the websites and links can look almost the same. Before getting involved, you should check all the details from official sources.
Sometimes, the tokens received are worth very little and might not cover the fees spent on transactions. If a project seems unknown or suspicious, it’s essential to think if taking the risk is worth it.