According to researchers at Chainalysis scammers took advantage of Ethereum switching from proof-of-work to proof-of-stake to steal over one million dollars.

Known as the “Merge”, this was when the Ethereum Mainnet merged with a blockchain called Beacon Chain to become a single channel. During the confusion of this switch, scammers were able to take advantage of investors and steal $1.2 million.

This was a fairly simple attack method. The scammers would tell Ethereum holders that they needed to upgrade their Ether to another blockchain by sending the cryptocurrency to them. Believing these were legit, the victims would then send their crypto to addresses held by the threat actors.

Essentially, the scammers made holders believe it was necessary to move Ether during the Merge. It is worth noting that in reality, no action was necessary.

“Most Merge scams functioned similarly to the classic trust trade scam, in which the fraudster tells victims to send them some amount of cryptocurrency to receive more in return (typically double the victim’s initial payment), often impersonating celebrities to do so. In this case, scammers told victims they should send in cryptocurrency in order to “upgrade” to the new Ethereum blockchain and receive funds in return.”

Scam Surge

Chainalysis details one scam where the Ethereum holder was told they would double their money by sending it to “another blockchain”. In reality, they were sending their crypto to scammers where it was never seen again.

To make themselves even more convincing, the scammers would also impersonate known people such as Ethereum chief Vitalik Buterin.

During the day of the Merge in September, the researchers saw a massive surge in scams. Specifically, scammers stole $905,000 during the day compared to just $74,000 in non-Merge-related scams.

India and the United States were the more frequently targeted countries.

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