“The ‘Liquidity Mining Scam’ is a very common scam in the cryptocurrency field, but new investors continue to fall victim to it. Recently, the ‘BNB/ETH Exchange Arbitrage Scam’ has resurfaced, and victims have discovered too late that they cannot retrieve their transferred crypto assets.
(Previous Summary: FBI warns of DeFi liquidity mining fraud, urges the public to stay away from Liquidity Mining scams)
(Background: Beware! MetaMask is flooded with fake airdrop phishing scams, community outraged: Musk allows scams to run rampant)
Table of Contents:
Newcomers in the cryptocurrency field fall victim to the BNB/ETH Exchange Arbitrage Scam
What is a Liquidity Mining Scam?
How to avoid being scammed?
While decentralized finance (DeFi) brings more possibilities to the blockchain, it is also maliciously exploited by many criminals. Many fraud cases disguised as DeFi have emerged, with the ‘Liquidity Mining Scam’ being a typical one.
Just yesterday, a Twitter user named ‘yingbnb’ shared the experience of an investor who fell victim to this scam on the X platform. The victim ended up transferring several ETH to the scammer, but did not receive the promised BNB in return, and could no longer retrieve their transferred crypto assets.
Newcomers in the cryptocurrency field fall victim to the BNB/ETH Exchange Arbitrage Scam
Based on the chat records posted by ‘yingbnb’, it is evident that this is an ‘BNB/ETH Exchange Arbitrage Scam’ that has appeared a long time ago.
The situation goes roughly like this: a scammer impersonating an official from the Binance exchange named ‘Binance Qi Qi’ contacted the victim on the social media platform Telegram, informing the victim that they could transfer their ETH from their wallet to a so-called ‘contract mining pool’ for liquidity mining. The scammer promised high returns in BNB to the victim.
However, the ‘contract address’ provided by the scammer was actually the address of a receiving wallet, so all the ETH transferred by the victim ended up in the scammer’s pocket.
The scam doesn’t end there. On one hand, the scammer cannot fulfill the promise of returning BNB. On the other hand, in order to scam more funds, the scammer continues to convince the victim to transfer more assets by claiming various reasons such as ‘transfer information error’, ‘irregular transfer operations’, ‘wallet risk control’, etc., in order to unlock ‘all earnings’ and remove the so-called ‘risk control’.
In the end, when the victim’s funds are completely depleted or they realize they have been scammed, the scammer stops responding or even blocks and deletes the victim.
What is a Liquidity Mining Scam?
We know that liquidity mining is a product of DeFi. In the crypto world, liquidity is crucial for cryptocurrencies, and many projects ask users to inject their crypto assets into liquidity mining pools to receive corresponding rewards within certain rules and time limits, with the users eventually being able to withdraw all their assets.
Therefore, a liquidity mining scam is a phishing scam disguised as liquidity mining. It often exhibits the following characteristics:
Strangers posing as official staff members often proactively contact victims on various social media platforms and provide investment advice, and eventually invite victims to participate in so-called liquidity mining activities.
Scammers often attract victims to unofficial platforms with exaggerated returns.
These platforms have forged investment data interfaces that display high returns.
Initially, scammers may actually return some profits to victims, but this is just to lure and induce victims to transfer larger amounts of assets, until the scammer has obtained a certain sum and stops returning anything.
How to avoid being scammed?
In fact, whether it is a token contract address or a DeFi contract address, they can be searched on the blockchain. Therefore, when someone proposes to transfer to a certain address, it is advisable to first check if the address has the correct corresponding entity.
The authenticity of many phishing websites or forged unofficial platforms can also be verified.
The identity of certain official staff members can also be found on relevant websites. For example, Binance has established an official verification channel where the authenticity can be verified.
Finally, Dynamic Zone reminds investors that while you may be attracted to high interest returns, scammers are targeting your principal. Therefore, when faced with transfer requests from others, remember to think twice before acting.
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