Key Takeaways
- A crypto user recently reported to have lost tens of millions of dollars in a so-called “address-poisoning” scam.
- Address poisoning is a type of scam that tricks users into sending their funds to the wrong address.
- The scammer creates a fake address similar to a legitimate one by copying the first and last parts of the actual address.
The crypto industry is renowned for its potential to yield massive profits due to its volatility, particularly during bullish market phases. However, anytime something that is super easy comes with extreme risks.
Let us discuss what address poisoning is and explain why double-checking everything before doing anything in crypto is essential so you can protect your capital.
What Is Address Poisoning?
Recently, someone lost $68 million in crypto by copying and pasting the wrong address, and this news broke all over Twitter/X.
Address poisoning is a type of scam that preys on crypto users who accidentally send their funds to the wrong address.
Scammers create fake addresses to look very similar to legitimate addresses, like the ones you have used before. This often involves copying an address’s first and last few characters and changing the middle characters.
How To Prevent Address Poisoning?
Anytime users send a transaction, they generally look at the address’s first and last four characters. Well, you are not supposed to do that; you should be checking the entire string to ensure it is correct.
Here are more ways you can do to prevent this type of scam:
- Always double-check the address before sending any crypto. Do not rely on copying from your transaction history.
- Use QR codes. Scanning a QR code ensures the address is entered accurately. Some wallets even offer unique QR codes for each transaction, adding another layer of security.
- Always do a test transaction. Send a small test transaction for large amounts first to confirm the correct address. This small sacrifice can save you big.
- Be wary of unfamiliar addresses. If you are sending crypto to someone new, take extra care to make sure you have the correct address.
- Consider getting a Web3 domain name. Unlike the long strings of characters that make up traditional crypto addresses, Web3 domains use familiar words and extensions, making them easier to read and less prone to typos or copying of the wrong characters.
Final Thoughts
That said, even the best investors need breaks! So, if you are feeling tired, stressed, or unable to focus, it is best to postpone sending crypto transactions. Just like entering a trade, sending crypto requires clear thinking to avoid costly mistakes. Stay safe out there!
