FBI Issues Warning on New Scams Targeting Web 3 Games

The Federal Bureau of Investigation (FBI) issued a Public Service Announcement (PSA) via the Internet Crime Complaint Center (IC3) alerting the public of new schemes targeting users who play 'play-to-earn' Web 3 games. According to the FBI, fake gaming applications that advertise lucrative financial incentives lure victims into depositing funds into specific wallets and give them fake rewards. Following this, the scammers leave with the deposited funds with the users still unaware.

As a result, the FBI has advised users to create unique wallets that can prevent unauthorized access. Additionally, the PSA also advises people to use third-party blockchain explorer and token allowance checkers to verify the authenticity of the apps being used.

Crypto Fraud Reaches $3.9B in 2022: FBI Advises on Preventive Measures

The PSA comes in response to the increasing number of cybersecurity breaches in various blockchain channels. According to Immunefi (via Venturebeat), the overall Web3 ecosystem lost about $3.9 Billion to cryptocurrency fraud in 2022 with the two most targeted blockchains being BNB Chain and Ethereum.

Perhaps the biggest of these came when alleged North Korean state-backed hacking group Lazarus hackers stole $620 million from Axie Infinity by using social engineering with a fake job listing on LinkedIn. This heist is still the largest decentralized finance hack to date, according to the DeFiYield REKT database, which tracks Blockchain scams, hacks, and rug pulls.

A recent report from Forbes detailed several types of crypto scams that include investment scams, phishing, upgrade scams, SIM-Swap scams, and crypto wallet scams. While the exact method by which they operate will differ, the ultimate aim of all these scams is to deceive  victims into revealing personal information or transferring digital assets such as non-fungible tokens (NFTs) to the attacker's account.

Since Crypto scams usually take place outside the jurisdiction of the victim’s country, it is often difficult for law enforcement agencies to take action and recover the lost cryptocurrency. So it is best to excise caution and protect yourself against these scams by practicing caution. The FBI's PSA emphasizes the need for users to read through white papers and understand the underlying technology of blockchain games before getting wallets and crypto tokens.