There was a sharp rise in phishing scams involving cryptocurrency during August, with losses exceeding $12 million as hackers began to leverage Ethereum EIP-7702-based exploits. Scam Sniffer reported that over 15,000 victims were affected by these phishing scams, an increase of 67% compared to July’s figures.
Crypto Phishing Losses Surpass $12 Million, Driven by Ethereum-Focused Exploits
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Crypto Phishing Scams Surge: Ethereum-Focused Exploits on the Rise
Phishing scams have become commonplace in the crypto space, with transactions and links not always doing what they advertise. Scam Sniffer, a tool that seeks to enhance the protection of users facing crypto scam dangers, has published its August phishing report, disclosing an increasing amount of funds lost to these schemes.
The service estimates that users lost over $12 million in these scams during August, a month-over-month increase of 72%. The number of victims also rose by 67%, with these schemes affecting 15,230 users.
Scam Sniffer pinpointed EIP-7702 batch-signature scams and direct transfers to phishing contracts as the most effective schemes during August. Three whales affected lost $5.62 million, 46% of all the funds lost during the month. Reports also indicate that World Liberty Financial token holders were targeted with this exploit, with the platform blacklisting some wallets for security reasons.
This exploit streamlines fund syphoning from a wallet with just an authorization for multiple transactions, a feature designed to improve user experience, but that also empowers criminals in the process.
Members of the Ethereum community predicted the rise of these exploits before the Pectra upgrade. However, as Scam Sniffer states, criminals have found ways to implement them for nefarious purposes, as EIP-7702 was introduced recently, and users are still unaware of its dangers. Without the developer scrutiny, these operations appear normal for regular users, who agree to transact their funds without suspicion.
Nonetheless, even with this rise, phishing scams are second to exploits as the main source of cryptocurrency losses. Security firm Peckshield estimated that 16 crypto exploits happened in August, resulting in losses of $163 million. This represents a 15% increase compared to July’s numbers.
Read more: WLFI Defends Wallet Blacklist as Protective, Not Punitive
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