Be wary of 3 scams exploiting ‘Ethereum mergers’

Less than 6 hours before the merger of Ethereum, this blockchain network, which is regarded as the underlying infrastructure of the next-generation Internet Web3.0, will completely change the consensus mechanism, from the PoW mechanism of Proof of Work to PoS of Proof of Stake.

Before the merger is imminent, Steve Bassi, founder of the decentralized security network market PolySwarm, suggested in an interview with the media that scammers may use the Ethereum merger market hot spot to launch new scams targeting novice crypto users, including fake ETH2.0 token swap, fraudulent ETH pledge mining pool, fake airdrop, etc.

The Ethereum official website also reminded in the latest “Security” page that the merger does not generate any “ETH2” or any other new tokens, do not transfer ETH to any designated address in exchange for false “ETH2″ tokens, ” Never share your wallet’s mnemonic with a stranger.”

Don’t fall into fraudulent betting pools for high returns

Due to the Ethereum merger, the PoW consensus that maintains the network through mining will be replaced by the PoS consensus that relies on staking to become a validator. According to Ethereum rules, staking is the act of depositing 32 ETH into the beacon chain to activate the validator software. Validators will be responsible for storing data, processing transactions, and adding new blocks to the blockchain. Validators can earn new ETH while keeping the Ethereum network running securely.

Steve Bassi believes that for the many holders of ETH, if they do not have the 32 ETH required to become an independent validator, joining a staking pool will be the only way for them to earn from staking rewards. But the co-staking provider “brings its own risk,” as it typically requires users to deposit ETH and relinquish control of the asset.

Bassi said the new staking provider “may offer very attractive terms” but could “suddenly rug pull” affecting participants in the pool. “This risk currently exists in the various asset pools or tokens of DeFi platforms, and scammers are likely to use the Ethereum merger to find a new role.”

Up to now, in addition to individual pledges to the beacon chain, many third-party service models have emerged that provide pledges for Ethereum, including pledge-as-a-service, collective pledge pools, and pledge services provided by centralized exchanges. The Ethereum official website also lists the risks, rewards and requirements of using a decentralized staking service.

Be wary of 3 scams exploiting 'Ethereum mergers'

Comparison of ETH staking services

Ethereum officials emphasized that these paths are aimed at a wide range of users and vary in terms of risk, reward and trust. “Users must do their own research before sending ETH anywhere.”

Beware of falling into the “ETH2 token” upgrade scam

Bassi also warned about another type of scam — tricking users into signing fraudulent transactions or taking users’ private keys under the guise of “migrating to the new Ethereum chain.”

One upgrade scam that has been repeatedly warned by Ethereum officials is to use the concept of “ETH2” – before the merger, scammers are likely to fool users into exchanging their ETH for “ETH2 tokens”. In fact, the merger does not generate any “ETH2” or any other new tokens. “The ETH you currently own is still the same ETH after the merger, without any exchange.”

The common sense to know is that as early as January this year, Ethereum officially abandoned the terms “ETH1” and “ETH2” and replaced them with the execution layer and the consensus layer.

Prior to this, ETH1 was often referred to as the existing proof-of-work chain, which, after the merger, would be deprecated through a difficulty bomb. Users and applications will migrate to the new proof-of-stake chain, which was previously known as ETH2.

In order to avoid confusion and prevent scams, the terms ETH1 and ETH2 have been deprecated. Ethereum officially asked core developers to stop using these two terms, and replace the terms ETH1 with “execution layer” and ETH2 with “consensus layer” respectively.

Therefore, any project that requires users to exchange new tokens under the guise of “ETH2” can be regarded as a scam. The Ethereum official website reminds on the security page that scammers may appear as “technical support”, telling users that they need to deposit the ETH in their hands to the designated address to get “ETH2”. In fact, this is not officially supported by Ethereum, and there are no new tokens. “Never share your wallet’s mnemonic with strangers.”

At the same time, it should be noted that there are some derivative tokens or certificates that may represent the pledged ETH, such as Rocket Pool’s rETH, Lido’s stETH, Coinbase’s ETH2, but these do not require the migration of ETH to the non-existent “new” Chain”, users do not need to deal with the underlying consensus conversion of ETH by themselves.

Don’t fall into the trap of phishing sites by coveting airdrops

In addition to the above two scams, Bassi added that another possible scam vector would come in the form of a “fake airdrop” — convincing users to sign a transaction authorization or visit a phishing site to receive a fake airdrop, “ETH merger will become Good excuse for these scammers masquerading as well-known, economically valuable projects promising airdrops.”

Bassi explained that these airdrops could direct users to a phishing site, where they could be tricked out of their ETH and private keys, or fall into an elaborate transaction signing trap.

Around the hot event of Ethereum merger, scammers are already using V-plus Twitter accounts to impersonate Ethereum co-founder Vitalik Buterin to promote fake ETH airdrops and induce netizens to visit the scammers’ encrypted wallets. These addresses are likely to be involved in phishing Fraud requires careful identification by investors.

Be wary of 3 scams exploiting 'Ethereum mergers'

Fake Twitter using Vitalik Buterin’s information

Aside from scams, the hacks targeting Ethereum mergers are not to be underestimated. Given the experience with previous testnets, most onlookers expect the merger to be successful. But Bassi said it’s still possible for scammers or hackers to find a way to play with the system, “We really don’t know if scammers or hackers have developed chain-targeted attacks or DDoS techniques when ETH 2.0 has the full economy of ETH 1.0 value, they can use attack techniques after the merger.”

If such an attack were to occur, Bassi believes it would likely only temporarily affect the network or affect the market, “because there are a lot of smart eyes looking at the combined behavior. However, attackers may look for opportunities to monetize any discovery.”

Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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