News Report Technology
January 02, 2024

Nest Crypto Wallet Founder Loses $125,000 in LFG Token Airdrop Phishing Attack

In Brief

Nest Crypto Wallet Founder Bill Lou got scammed through a phishing attack while participating in the LFG token airdrop, lost 52 stETH tokens.

Nest Crypto Wallet Founder Falls Victim to LFG Token Airdrop Phishinig Attack, Loses $125,000

The co-founder and chief executive officer of the security-focused cryptocurrency wallet app Nest, Bill Lou experienced a phishing attack while attempting to participate in the “less fees and gas” (LFG) token airdrop, resulting in the loss of 52 stETH tokens valued at $125,000.

The LFG token airdrop was introduced to reward Ethereum users who have spent over $4,269 on transaction fees since 2016, with the goal of onboarding them to the Solana blockchain.

A deceptive website, imitating the official LFG token platform, emerged to illicitly obtain users’ funds, and Bill Lou became one of the notable victims. He clicked on a link from an article in a Google search that directed to the fraudulent website.

Bill Lou is not the sole victim of such attacks, as others have reported their wallets being drained after clicking on similar fake links through counterfeit X (formerly Twitter) accounts.

LFG Project’s Reaction to the Scam 

Addressing the issue, the LFG project provided clarification on the situation on its official X (formerly Twitter) account and the website details. According to the project, a total of 400 billion LFG will be airdropped to the 387,000 qualifying wallets, and any unclaimed tokens will be burned within one month. 

Approximately 25,000 users have claimed LFG tokens on Solana thus far. Out of the total supply of 1 trillion LFG tokens, 60% is reserved for airdrops, 10% is allocated to early contributors, 6% is designated for liquidity provision, and 24% is allocated to the treasury. 

Surge in Phishing Scams

In 2023, more than 324,000 crypto users were victims of phishing scams, resulting in approximately $295 million in digital asset losses to wallet drainers, according to the “2023 Wallet Drainers Report” by Scam Sniffer. 

Throughout the year, there was observed growth in phishing activities. Scammers successfully circumvented the advertising guidelines of Google and X, enabling phishing websites to publish paid Google Search and X (formerly Twitter) ads.

Furthermore, phishing websites attract organic traffic through fraudulent airdrops of crypto assets or non-fungible tokens (NFTs). They also take control of expired Discord links and engage in spam comments and mentions on X.

In a recent incident, a phishing scam targeting the Stargate Snapshot platform has raised significant security concerns. A LayerZero Discord Moderator disclosed that a scammer utilized a deceptive proposal vote, incorporating a phishing link and staking STG tokens. This strategy led to the participation of over 1,000 users in the vote, allowing the scammer to generate a profit exceeding $43,000.

As phishing attacks continue to target high-profile individuals, and the surge in such fraudulent activities becomes more prevalent, the cryptocurrency community faces a growing need for heightened vigilance and awareness. 

Disclaimer

In line with the Trust Project guidelines, please note that the information provided on this page is not intended to be and should not be interpreted as legal, tax, investment, financial, or any other form of advice. It is important to only invest what you can afford to lose and to seek independent financial advice if you have any doubts. For further information, we suggest referring to the terms and conditions as well as the help and support pages provided by the issuer or advertiser. MetaversePost is committed to accurate, unbiased reporting, but market conditions are subject to change without notice.

About The Author

Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.

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Alisa Davidson
Alisa Davidson

Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.

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