How to Spot a Red Flag
Just because you own cryptocurrency, doesn’t mean you’re savvy enough to spot a scam. More than 400 payments totalling around 13 bitcoin were given to the hackers. There were several red flags surrounding this scam, none of which made the victims skeptical enough to resist sending bitcoin. The first red flag is the promise to double your money within an hour. A good litmus test for a scam is if it seems too good to be true, it probably is. Unfortunately, people too often fall into the emotion of FOMO or the “Fear of Missing Out”. The hacker put a time limit on their promise, this may have prompted victims to take immediate action.
The second red flag is who was targeted. Some of the hacked twitter accounts simply would never be sending bitcoin to anyone. Elon Musk and Kanye west, maybe, but not Warren Buffet or Barack Obama. Buffet has been quite clear about his distaste for bitcoin. The question the victims should be asking themselves is, “does this actually make sense?”
The Scam is Not a Crypto Problem
The perpetrators of the scam allegedly used a twitter employee to conduct the hack of the high profile accounts. This narrative makes sense, as compromising several high profile twitter accounts at once would be quite the difficult task. Many will be quick to blame cryptocurrency in general for the scam. It is important to put things in perspective and understand that cryptocurrency is simply a tool. This scam took place due to a security failure within twitter, not due to any inherent nefariousness within cryptocurrency.
Cryptocurrency to be Punished
Twitter has taken immediate action in response to the hack. Cryptocurrency addresses can no longer be posted on twitter. This actually has broad implications for the cryptocurrency community. One popular twitter account Whale_Alert can no longer automatically post large bitcoin transfers. Traders use this twitter account to identify when a whale (rich crypto account) is moving large amounts of cryptocurrency for selling. This is a perfect example of the tragedy of the commons. This hack, perpetrated by a few, is spoiling twitter, and cryptocurrency for the many. This entire situation highlights the need for two things. The first is the ability for the general cryptocurrency user to spot a scam, in short scam awareness. The second is tighter security at Twitter.