Multichain cryptocurrency wallet provider, Trust Wallet, has cleared the air around a mysterious $4 million theft from its user’s account. Rumors about the theft started circulating on Monday, January 6. 

According to the rumors, a scammer carted $4 million in crypto assets away from the Trust Wallet user with merely a picture of the user’s balance. The hacker never used any seed phrases or passwords to access the account. Trust Wallet took to Twitter on Wednesday to share a statement explaining the events behind the hack attack.

According to Trust Wallet’s statement, it carried out investigations into the mysterious theft and made an interesting observation. The mastermind behind the hack attack is a particular crime unit that has orchestrated strings of theft on other wallet providers in regions such as Barcelona and Milan.

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Aside from the victims, many crypto community members have reported that the criminals also approached them. The hackers posed as Web3 project investors and deceived users into showing them their wallet balances.

Trust Wallet further explained that these criminals often approach users asking for proof of funds on hot wallets before taking action. The notorious hackers spend weeks persuading their victims to transfer their funds from a multi-signature wallet to a single-key Trust Wallet. 

Multi-signature wallets usually require two or more private keys before signing in and sending a transaction. So, it would be more difficult for hackers to access a multi-sig (multi-signature) wallet than a single-key wallet.

The wallet provider also explained that the hacker shared an NDA pdf file and fake KYC information with the victim, which they suspect might have contained malware. The malware introduced vulnerabilities that allowed the thief to access the user’s wallet and move the funds.

After explaining the hack process, Trust Wallet ended its statement with advice to users to remain alert against scammers. In other words, users should rest assured that their funds are safe with Trust Wallet, but they must stay vigilant to prevent criminals from taking advantage of them.

Hack attacks are no longer new to the crypto industry. Hackers have developed malicious strategies to steal funds from unsuspecting customers on crypto platforms. Some introduce phishing sites into online crypto platforms to lure users into unknowingly transferring their funds.

Some even fix malicious codes through phishing websites and hijack user transactions. Last year, Changpeng Zhao, Binance’s CEO, advised users to stay alert against phishing scams that pop up with Google search results.

In a recent report, CertiK Alert revealed that hackers attacked Azuki’s official Twitter account and introduced links through which they stole about $758,000 from the platform. BonqDAO protocol also witnessed an oracle hack that left its platform with a $120 million loss in user funds.

Given the constant account compromise and hack attacks in the crypto ecosystem, many wallet providers have integrated new features to protect users. On January 30, Coinbase announced its new wallet app safety features that flag suspicious activities and allow users to take countermeasures to prevent fund loss. 

Also, on January 27, the Phantom NFT platform announced new security features in its wallet app. Phantom’s security features allow users to preview transactions and report NFT spamming. It also has an open-source block list that keeps users from connecting with malicious domains.

Featured image from Pixabay and chart from Tradingview.com

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