Crypto investors have lost Bitcoin and Litecoin worth a total of 282 million USD after falling victim to a social engineering scam involving a hardware wallet
On January 16, blockchain transaction investigator ZachXBT revealed a major theft, reporting that the perpetrators siphoned off 2.05 million Litecoin (LTC) and 1,459 Bitcoin (BTC) from the victims' accounts
Monero surged 36% after hackers converted the stolen crypto into a privacy coin.
Cybersecurity company ZeroShadow confirmed that the perpetrators carried out the heist by impersonating Trezor customer support, with Trezor being a major hardware wallet provider with over 2 million users.
These groups of criminals can trick victims into revealing their recovery seed phrase, which effectively grants full control of the assets to the perpetrators.
After the data breach incident, the criminals immediately began laundering the stolen money.
ZachXBT reported that the criminals used multiple instant exchange services, particularly Thorchain, to convert the stolen Bitcoin into Ethereum, Ripple, and Litecoin.
Meanwhile, the heavy reliance of the criminals on Thorchain has led to severe criticism of this decentralized infrastructure provider.
ZachXBT noted that this is not the first time malicious actors have used this platform in such a manner, indicating that it remains a favorite resource for criminals looking to move stolen assets.
At the same time, the hacker also converts a significant amount of money into Monero (XMR), which is a privacy-focused token designed to keep transactions confidential.
ZeroShadow tracked the outflow of funds and managed to seize over 1 million USD before it was exchanged for XMR. Activities that could slip through may result in an increase in XMR's price, ZeroShadow stated.
Notably, this urgent purchase of XMR has led to a significant rise in the market price of Monero.
Data from BeinCrypto shows that this token surged over 36% within a week, reaching a peak close to 800 USD, before the asset's value adjusted to around 621 USD as news broke.
This incident underscores the growing security crisis in the digital asset industry, as criminals shift their tactics and focus more on social engineering and brand impersonation rather than technical code hacking to deceive victims.
Blockchain analysis firm Chainalysis identified this trend, reporting that identity theft scams increased by 1,400% year-on-year. Additionally, the company stated that the average loss per incident increased by over 600%.
