How to Avoid Cryptocurrency Scams: Two Important Checks by ZachXBT That You Need to Know

ZachXBT, a renowned blockchain investigator, recently shared two important “minimum checks” on Telegram to avoid cryptocurrency scams. He emphasized that users must bear full financial responsibility if they accept risks in these situations and added that recovering lost funds will be extremely difficult. Evaluating the Reliability of a Project is Very Important ZachXBT has highlighted two important scenarios: depositing funds into branched DeFi protocols on newly launched EVM chains and being scammed by projects with few smart followers on Kaito. ZachXBT emphasized: “If you make any of these decisions, then it is your personal choice to risk your money and I will NOT help you.” Many new DeFi protocols launched on the EVM chain are copies of existing protocols. Their teams often do not create original code but instead fork from established protocols. This process requires less technical skill but poses significant security risks. A recent incident has highlighted the risks in the DeFi space. The DeFi protocol SIR.trading is said to have been hacked, resulting in an estimated loss of $350,000. Although the project’s documentation promotes it as a “new DeFi protocol for safer leveraged trading,” it acknowledges the risks associated with smart contract vulnerabilities. This case illustrates how new DeFi protocols often become targets for hackers. Additionally, at the end of March, the DeFi lending protocol Abracadabra lost approximately 13 million dollars due to exploits related to collateral tokens. The second situation that ZachXBT warns about involves being “rude” (trở falling victim to a drag thảm) by projects with few intelligent followers on Kaito. Kaito is an AI-powered analytics tool that measures genuine community interest. He advises that checking the quantity and quality of followers is a fundamental step to avoid being deceived by projects that use artificial interactions or inflated empty advertising. Investor Xero agrees with ZachXBT that Kaito could be a tool for assessing reliability. “Kaito has become a great security and reputation tool that I value more than other tools. It can help you quickly identify impersonators or new rug pull projects. If a project has more than 40 thousand followers and is not connected to real smart followers, then it is not a legitimate project,” Investor Xero commented. Other Emerging Cryptocurrency Scams In addition to the warnings from ZachXBT, recently some new scam tactics have been discovered. Investor Jerome has warned about a scheme that exploits the automatic download feature of browsers to trick users into downloading malware. Another method involves scammers creating and sending small transactions. They are often as small as 0.001 tokens—using fake wallet addresses that closely resemble legitimate ones. Their goal is to trick users into copying and pasting the fraudulent address when making future transactions. Additionally, Microsoft has identified StilachiRAT, a new remote access trojan specifically designed to target cryptocurrency wallets and login information. According to a report by Chainalysis, from 2021 to 2024, decentralized financial platforms (DeFi) are the main targets of cryptocurrency attacks.

The report explains that DeFi platforms may be more vulnerable because developers prioritize rapid growth and launches over security measures. This lack of focus on security makes them a primary target for hackers.