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7 Biggest Cryptocurrency Scams and Arrests in History

Cybercriminal is real, and if you are into digital currencies, it can hurt you. In the past, people on the other side of computing law did tremendous deeds in the cryptocurrency market. But, not the good kind. Only in the past few years, through frauds, villains stole more than $5 billion. Those who suffered the most were investors, cryptocurrency exchanges, and simple users who deal with crypto.

The worst part of all of this is that many of the perpetrators managed to get away, and they now enjoy someone else money. Yes, there are people who manage to steal cryptocurrency from users, transfer it to their accounts, convert it to Fiat, and eventually spend it. But luckily for all of us, their stories don’t always have happy endings. Arrests were made, and some of them ended behind bars. If you want to have anything with Bitcoin and other cryptocurrencies, try picking a higher road that bitcoinprofit offers. It’s honest work, and it can pay off. Now, let’s take a look at seven biggest cryptocurrency scams and arrests in history.

BITPoint hacking Incident

Source:cointelegraph.com

In July of 2019, this Japanese crypto exchange lost millions. To be precise, they parted ways, thanks to hackers, with $28 million. When this theft happened, it was reported that the sum was significantly lower, but the number above is the official one. In this case, both the exchange and their clients lost money. BITPoint lost $19.3 million while their customers were lightened by $8.7 million. In this cyber attack, many cryptocurrencies were lost, including Litecoin, Ether, XRP, and of course, Bitcoin. The company was left in shambles, but nonetheless, they announced that their clients are going to be recompensed. Fair play to them.

Crypto-Arrest in Israel

Source:btcmanager.com

The men in question who committed a phishing scam were brothers from Israel. Their criminal endeavor lasted for more than three years. Eli and Assaf Gigi were 31 and 21 at the moment of arrest. Their crime was that they stole more than $100 million in cryptocurrency. What they did was a scam like no one seen before. They lured people from forums such as Reddit to their website that looked like an official exchange.

Binance Parts Ways With $40 million

Source:coindesk.com

Binance is one of the world’s most famous exchanges, which was considered impenetrable. But, in May of 2019, they lost more than $40 million in cryptocurrency. Before this attack, it was not recorded that exchange as big as this one was attacked. Hackers managed not only to steal 7,000 Bitcoin, but they also dealt a massive blow to the security and safety of Binance. In addition to Bitcoin, they also got their hands on API tokens and two-factor authentication.

According to the company itself, hacker primarily targeted their most lavish accounts. While you must think we are talking about vast sums of money, Binance wasn’t shaken to the ground. The amount stolen amasses only 2% of their capital. Furthermore, they managed to cover losses by using their self-insurance fund named SAFU.

“Typosquatting” Scam Uncovered

Perpetrators believed that they are going to get away after stealing $27 million, but this was not the case. Arrests were made, and six people were apprehended. Police worked on two sides as the group who worked on this scam was divided into UK and Netherlands sub-groups. The investigation that followed their wrongdoings lasted fourteen months. The arrests were made in the southern part of England and Rotterdam and Amsterdam. Their scam was widespread as more than 4,000 people fell victim to his group. Their actions spread across twelve countries.

What these criminals did was the creating of a fake cryptocurrency through which they would then gain access to the victim’s wallets. This process is called “typosquatting” and they mostly targeted Bitcoin.

Kraken Bitcoin Crash

Source:bitcoinexchangeguide.com

If you are even remotely interested in cryptocurrencies, then you must have heard of Kraken. They are a platform that excels in trading Bitcoin. The wider public heard of them when thanks to a flash crash, that caused the fall of Bitcoin. Due to a hacking breach, this crypto fell from $8,400 to $75. This was quite a shock that didn’t last too long, and Bitcoin quickly rose back in value. This is why many people ignored it ever happened, and many others believed this was a glitch. Instead, it was a hack attack.

When this glitch happened, a particular hacker entered accounts that possessed large amounts of Bitcoin and took 1200 Bitcoin. At the time of this event, this amount of Bitcoin was worth north of $10 million. Quite a gain.

Bitrue $4 Million Loss

Source:themerkle.com

Last year in June, this Singapore based exchange was robbed of $4.2 million. Unfortunately, it was mostly the users’ assets. What was stolen were 9.3 million of XRP and 2.5 million of ADA. Hackers exploited the company’s weak security system during one of their safety reviews no less. Bitrue was shaken, but they committed to returning the funds to their clients and also to improve their security system.

GateHub And $10 million XRP Theft

Source:cryptoconsulting.info

It would seem that hackers do most of their crimes during the summer, as $10 million worth of XRP was stolen from GateHub in June of 2019. The value was stolen from their Ledger wallets. In this case, some of the XRP was managed to be salvaged in a short time as more than 500,000 of XRP was returned to users. GateHub reported that almost 100 of their Ledger wallets were compromised.

Conclusion

People are going to tell you that crime never pays off, but there are two sides to every coin. The same is with Bitcoin and other cryptocurrencies. As you can see from the stories above, some were caught for their crimes while others still roam free. We sincerely hope that perpetrators are going to be apprehended as most of the investigations are still opened. After all, we are talking about large sums of money, and big brands had their reputation endangered. This is reason enough to work on finding those who stole and got away with it. We hope that their freedom won’t last as long as being safe in the crypto world is essential for its growth.

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