What is Cryptocurrency Phishing? How does a phishing attack work?

Dec 15,2022
What is Cryptocurrency Phishing? How does a phishing attack work?

What is Cryptocurrency Phishing? How does a phishing attack work? Phishing is a cryptocurrency scam involving tricking victims to give up their private keys or personal information. Attackers usually disguise themselves as legitimate entities or individuals to gain the trust of victims. Once the victim is cheated, the attacker will use their information to steal their cryptocurrency funds.

As cyber criminals and cyber attacks become more and more complex, phishing fraud becomes more and more common. Many of these targets are wallets, cryptocurrency exchanges and initial coin products. Therefore, cryptocurrency users must understand how they protect themselves and their funds. Next, we will discuss the working principle of phishing fraud, identification methods and how to avoid phishing attacks.

How does a phishing attack work?

Phishing attacks usually begin with attackers sending mass emails or messages to potential victims. It usually looks like it came from a legitimate source, such as a wallet or cryptocurrency exchange.

The message almost always contains a link to a fake website that looks exactly like the real website. Once the victim clicks on the link and enters their login information, the attacker will (incorrectly) use it to access their account.

Phishing attacks encourage targets to take action by attracting their sense of urgency or fear. For example, a message might claim that there is a problem with the victim's account and that they must log in immediately to fix it. Others try to lure victims by offering false rewards or airdrops.

Some attackers even pretend to be worried, reminding the account owner of "suspicious activities" and asking them to enter login credentials on the fake website.

How to identify phishing emails?

Unfortunately, phishing emails are hard to find. Most phishers do their best to make their emails and websites look legitimate. However, there are some danger signs to be aware of:


Plagiarism involves copying unique content from an organization, such as specific text, fonts, logos, or color schemes on a real website.

The best way to avoid imitating phishing is to become familiar with the brand of the organization you are dealing with. In this way, you will be more likely to catch the impostor.

Spelling or grammar errors

Phishing emails usually contain spelling or grammar errors. Phishing people are usually eager to publish news and do not spend time proofreading. In some cases, they are not good at the language they use. If you see an email with obvious errors, it is likely to be a phishing attempt.

Misleading Links

Another way to phish someone is to include a link in the email that looks like it points to a legitimate website, but actually takes you to a fake website. A common approach to phishing attacks is to use shortened Uniform Resource Locators (URLs) or embedded links that disguise real target sites.

For example, the displayed hyperlink anchor text may be very different from the actual link URL. In order to visually imitate the real link target, phishers make small mistakes, such as replacing the lower case letter "i" with the upper case letter "I".

Use public e-mail instead of company e-mail

Attackers often use public e-mail accounts because it is easier to create fake e-mail using a public domain than using corporate e-mail. Therefore, official emails ending in "@ gmail. com" instead of "@ companyname. com" should be immediately suspected.

Content dislocation

Another way to discover phishing emails is to find out if the content is aligned. When phishers mimic legitimate email, they do not always get the right details. It may be different from the tone or style you usually get from a particular company.

In some cases, the mismatch between the message and the embedded image may indicate a phishing attempt. For example, an email might say "click here to sign in", but the button would say "click here to sign up".

Common encryption phishing attacks

Several types of phishing attacks are particularly common in the cryptocurrency field:

Harpoon Fishing Attack

Harpoon phishing is a targeted attack against specific individuals or organizations. Here, phishers have some prior knowledge of their goals and will use it to customize phishing emails to make them appear legitimate. For example, an attacker could forge an email from a person or organization familiar to the victim. Then add a malicious link disguised as an innocent link.

Whaling attack

Whaling attack is a specific type of harpoon phishing attack targeting well-known people in the organization, such as CEO. It is particularly dangerous because it has a wider range of impacts than conventional spear phishing attacks. For example, if the CEO is duped and clicks a malicious link, an attacker can gain access to the entire company network.

Clone fishing attack

This attack occurs when a phisher creates a copy of a legitimate email that was sent to the target in the past.

The attacker replaces the original attachment or link with a malicious attachment or link and sends it to the victim. Since the email looks the same as the email the victim received before, they are more likely to click on the link out of habit or familiarity.

Spoofing attack

In this type of phishing attack, the victim will be redirected to a fake website, even if they have entered the correct URL. This is usually achieved by infecting the DNS server responsible for converting the URL to an IP address with malicious code. When the victim attempts to visit a legitimate website, the code will redirect the victim to the attacker's fake website.

Domain spoofing attacks are particularly dangerous because they are difficult to detect. The victim may have entered the correct URL of their bank website, but still logged into a fake website that looks exactly the same as the real website.

Evil Twin Attack

The evil twin phishing attack targets the public Wi Fi network. The attacker's approach is as follows: they will use the same name as the legitimate network to establish a fake Wi Fi network. When the victim connects to the network, the system will prompt them to enter login credentials, which can then be used by phishers to access their accounts.

Voice Phishing Attack

Also known as phishing, this type of phishing uses voice calls or voice mail instead of email. It usually occurs on voice based media, such as voice over IP or traditional residential telephone services.

In a voice phishing attack, the attacker will forge the caller ID so that it looks like it is from a legitimate organization (such as a bank). Phishing fraudsters often use voice synthesis software to leave voice mail in their bank or credit accounts to warn potential victims of fraud.

SMS phishing attack

SMS phishing, sometimes called phishing, uses text messages instead of email. Phishing attackers send seemingly legitimate company text messages to victims. When the victim clicks the link in the SMS, they will be prompted to enter their login credentials, which the attacker uses to access their account.

DNS hijacking

Domain Name System (DNS) hijacking redirects the victim to a fake website by changing the DNS entry of a legitimate website. In order to perform an attack, phishers will replace DNS entries so that they point to different IP addresses. When the victim attempts to visit a legitimate website, they will be redirected to the attacker's fake website.

Then the attack is carried out by loading malicious software on people's computers, controlling routers or interfering with DNS communication.

Phishing robot

Phishing robot is a computer program that automatically executes phishing attacks. They can be used to send a large number of phishing emails, create fake websites and host these websites on the server. Such robots can also automatically collect login credentials and other sensitive information of victims. These programs are often used in conjunction with other types of attacks, such as denial of service attacks and spam.

False browser extensions

These extensions are malicious plug-ins designed to mimic legitimate plug-ins. They are often used to steal sensitive information, such as login credentials and credit card numbers. In addition, they can redirect victims to fake websites, inject malware into their computers, or display unwanted advertisements.

Fake browser extensions are usually distributed via phishing emails or malicious websites. After installation, they may be difficult to remove. These extensions are essentially phishing private information such as mnemonics, private keys, and keystore files.

Ice fishing

In this form of phishing, the attacker will send the victim a false transaction that appears to come from a legitimate source. The transaction will require the victim to sign it with their private key. In other words, the victim is tricked into signing a transaction that transfers the authority of his token to the fraudster. If the victim continues, they will unknowingly transfer the ownership of their tokens to the attacker.

Encrypting malware attacks

Encrypting malware attacks are malware that encrypt the victim's files and demand a ransom to decrypt them. It can be spread through phishing emails, malicious websites, or fake browser extensions. Once installed on the victim's computer, malware encrypts their files and displays blackmail information on their screens.

How to avoid encrypted phishing attacks?

1. Be careful with email, especially if they contain attachments or links. If you are not sure about the email, please contact the sender directly to confirm its authenticity.

2. Do not click the link or download the attachment from a source you do not trust.

3. Keep your operating system and software up to date.

4. Use strong passwords. Do not reuse passwords between different accounts.

5. Enable two factor authentication when available.

6. Don't disclose personal information to anyone, such as your wallet address or private key.

7. Use a reputable cryptocurrency exchange and wallet.

8. Beware of websites that look suspicious or incredibly good. If you are not sure, please conduct a web search to see if anyone else reports that it is false.

9. Don't download browser extensions from unreliable sources.

10. Use VPN when connecting to the Internet, especially when using public Wi Fi.