Beware of scams related to wallet recovery phrases

In the world of cryptocurrencies, scammers use deceptive tactics to lure people into fraudulent schemes related to digital wallets.

A common scam involves the creation of a wallet, funding it with cryptocurrencies, and then publicly sharing the recovery phrase ( also known as a seed phrase or mnemonic ), presenting it as an opportunity for others to withdraw funds.

Here's how this type of fraud usually works:

Publicly share recovery phrases

Scammers spread a recovery phrase for a wallet with funds, encouraging people to access and withdraw the money themselves. They present it as an opportunity to get free cryptocurrencies.

Gas Fee Request

To withdraw the funds, the scammers instruct users that they must pay a small "gas fee" or transaction fee. They claim that this fee is necessary to process the withdrawal.

Automated Withdrawal

Without the victims knowing, the wallet is linked to a bot or automated system controlled by the scammers. When the victims deposit the requested gas fee, the bot immediately withdraws the deposited amount, leaving the victims with no way to access the funds they believed they were claiming.

Endless Cycle

Victims can fall into an endless cycle, as each time they attempt to withdraw funds by paying the gas fee, the same process repeats, leading to the loss of their money through the gas fees paid.

Protect yourself against these scams

| Security Measure | Description | |---------------------|-------------| | Education and Awareness | Understand that legitimate cryptocurrency operations do not ask for recovery phrases or payments to withdraw funds. Be cautious if someone publicly shares a recovery phrase as part of a supposed donation scheme or free funds. | Verification | Always verify the credibility of sources and avoid participating in offers that seem too good to be true. Legitimate cryptocurrency transactions do not require people to pay fees upfront to access their own funds. |

Warning Signs of Scams

Be aware of these signs that may indicate a possible scam:

• Publicly sharing recovery phrases: Legitimate entities or individuals in the cryptocurrency space would never publicly share a recovery phrase, as they are confidential and grant access to the funds.

• Advance payment requests: Scammers often ask victims to deposit a "gas fee" or any advance payment to access the supposed free funds.

• Unrealistic promises: Scammers lure victims with promises of effortless easy or free money. Be wary of schemes that promise large sums of cryptocurrency with minimal to no effort.

• Automated or repeated requests: If the process involves repeated requests for small payments (gas fees) without a successful withdrawal of funds and continues to repeat the same cycle, it is a clear indication of fraud.

• Lack of transparency: Fraudsters usually lack transparency or clear information about the process. Legitimate transactions usually have transparent and verifiable procedures.

• Pressure or urgency: Scammers often create a sense of urgency, pressuring victims to act quickly or they will miss the supposed opportunity.

In the cryptocurrency ecosystem, protecting your private keys, recovery phrases, and personal information is crucial. If something seems off or does not align with standard practices in the cryptocurrency ecosystem, it is best to avoid it and seek advice from trusted sources before initiating any transaction or offer. Stay vigilant and prioritize your security to avoid scams.