Crypto Criminals Not on Holiday, Scams Like 3Commas and ‘Pig Butchering’ Continue to Strike

This week, the private API keys of around 100,000 crypto users were leaked on public domains.

Written by Radhika Parashar, Edited by Richa Sharma | Updated: 29 December 2022 17:20 IST

Crypto Criminals Not on Holiday, Scams Like 3Commas and ‘Pig Butchering’ Continue to Strike

Photo Credit: Unsplash/ Bermix Studio

Chainalysis recently claimed that this October saw the most number of crypto scams

Highlights

3Commas has made security tweaks for its platform
Binance CEO has tweeted warnings post 3Commas scam
FBI is maintaining strict oversight over crypto sector

The crypto sector, thriving in several parts of the world, was struck with several hack and scam attacks this year. Even a couple of days before the industrially quaky year of 2022 ends, news and warning around crypto crimes have made it to the headlines. This week, the private API keys of around 1,00,000 crypto users were leaked on public domains. The victims were all users of 3Commas, an Estonia-based crypto trading service. The incident added more stress to the already disturbed crypto sector that has drastically dropped down in valuation to a yearly low to $795 billion (roughly Rs. 65,87,830 crore).

3Commas lets users set up an automated feature that has bots initiate trades on third party exchanges like Binance, Coinbase, and KuCoin on behalf of the users.

An anonymous hacker, as confirmed by 3Commas, had been at work since October that reportedly resulted in a loss of user funds up to $12 million (roughly Rs. 100 crore) via unconsented transactions. These transactions were processed via 3Commas on exchanges like Binance and Coinbase.

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Previously, the company was exploring if these unverified transactions were being triggered by phishing attacks.

1. Statement from 3Commas:

We saw the hacker's message and can confirm that the data in the files is true. As an immediate action, we have asked that Binance, Kucoin, and other supported exchanges revoke all the keys that were connected to 3Commas.
— Yuriy Sorokin (@YS_3Commas) December 28, 2022

Several members of the crypto community, including Binance CEO Changpeng Zhao, shared awareness and safety suggestions for others.

I am reasonably sure there are wide spread API key leaks from 3Commas. If you have ever put an API key in 3Commas (from any exchange), please disable it immediately.

Stay #SAFU.
— CZ :large_orange_diamond: Binance (@cz_binance) December 28, 2022

To be safe, if you used @3commas_io with any exchange, you need to go to that exchange and delete the specific API keys. We proactively did this for @krakenfx clients 2 weeks ago.

Just disabling @3commas account or removing your API keys there won't protect you. https://t.co/qgKvI1DaKT
— Nick Percoco (@c7five) December 28, 2022

My strong recommendation for all @3commas_io leak victims is to hire the lawyer ASAP

Link to leakage belowhttps://t.co/QRstmpwumF

Best documented lawsuits would win and you will have a chance for compensation
— Dyma Budorin :flag-ua: (@buda_kyiv) December 28, 2022

The incident comes in the backdrop of crypto crimes gaining more and more pace around the world.

US' Federal Bureau of Investigation (FBI) has warned crypto investors there about a new technique of ongoing scams — called the ‘pig butchering'. In these instances, scammers get potential victims to move their investments to cryptocurrency. Once their digital wallet ‘fattens', these scammers hack and steal the funds.

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“Be very careful when you go on social media and dating apps and somebody starts developing a relationship with you, and wants you to start investing. Don't get butchered,” Bitcoin.com quoted Frank Fisher, public affairs specialist at the FBI's Albuquerque division, as saying.

Back in November, the authorities in the US reportedly claimed to have identified and confiscated seven domain names that were exploited in pig butchering scams.

In a recent report, Chainalysis claimed that the month of October has been the worst in terms of crypto-related crimes. The crypto sector lost over $718 million (roughly Rs. 5,890 crore) owing to such crimes.

Back-to-back hack attacks on the digital assets sector contributed heavily to how the market turned-out to reach its current low valuation of $795 billion (roughly Rs. 65,87,830 crore).

Glassnode, in its latest report, has claimed that most Bitcoin holders have moved their holdings to self-custodial crypto wallets. Glassnode has estimated that around 550,000 Bitcoin worth $9.2 billion (roughly Rs. 76,760 crore) have left crypto exchanges.

Will crypto tax hurt the industry in India? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

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Further reading: Cryptocurrency, 3Commas, Binance, Coinbase, KuCoin, Crypto Scams, FBI

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More