Crypto Wallet Founder Hit by $125,000 Loss in LFG Token Phishing

Jan. 2, 2024
Crypto Wallet Founder Hit by $125,000 Loss in LFG Token Phishing

The co-founder and CEO of Nest, a security-focused crypto wallet app, fell victim to a phishing attack. He attempted to claim what he believed to be a genuine airdrop, resulting in the loss of 52 stETH tokens valued at $125,000.

The LFG token airdrop, introduced recently, targets Ethereum users who have incurred transaction fees exceeding $4,269 since 2016. This initiative aims to incentivize their transition to the Solana blockchain by offering rewards.

“I just got scammed $125k of state trying to claim the LFG airdrop,” Nest Wallet co-founder Bill Lou wrote on X today.

Lou clicked the link from an article at the top of a Google search regarding the airdrop that led to the scam website. “I saw an article guide to the airdrop and followed the link to sign a message. I didn’t even question it,” Lou explained. He said he used MetaMask with a claim that Nest didn’t have a “test version installed and was fixing some bugs” instead of Nest. Lou added that the wallet would have caught his product if he had.

“Transaction simulation is a must,” Lou said to The Block. “Nest Wallet has this built-in, and MetaMask completely lacks it. This could have been completely avoided.”Lou emphasized the importance of searching for official X accounts while sharing links. Additionally, he suggested using multi-sig wallets for added protection.

Crypto Scams Alert: Fake X Accounts Target LFG Users

Lou’s case appears part of a broader pattern, as others have fallen victim to similar attacks. They reported losses from their wallets after clicking on fraudulent links through fake X accounts.

The project behind LFG, acknowledging the issue, posted a statement stating, “We are aware of several scam accounts impersonating us and are reporting them. Please do the same and help protect your fellow users,” clarifying its official X account and website details.

The project plans to airdrop 400 billion LFG to 387,000 qualifying wallets. The protocol stipulates that any unclaimed tokens will undergo burning within one month. As per current data from CoinGecko, the token is $0.000069.

To date, LFG has seen some 25,000 users claim tokens on Solana. Another X post reveals that the total supply of 1 trillion LFG tokens allocates 60% for airdrops, 10% for early contributors, 6% for liquidity provision, and 24% for its treasury.

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Rida Fatima

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An ardent wordsmith with a rich five-year background in delving into the realms of finance and cryptocurrencies. Alongside curating captivating blogs, Unique's talents extend to crafting imaginative and engaging content.