Russia’s Kaspersky warns scammers post crypto wallet seed phrases on YouTube to steal funds

Scammers are exploiting YouTube’s comments section, sharing seed phrases to lure greedy individuals into a multi-signature wallet scam.

Bad actors have seemingly found a new way to exploit crypto users by sharing seed phrases, tricking victims into attempting to steal funds from a multi-signature wallet, only to fall victim to the scam themselves.

In a blog post on Dec. 23, Russia’s sanctioned cybersecurity firm Kaspersky revealed a scam after a comment appeared under a finance YouTube video. The user shared their seed phrase and asked for help transferring funds from their wallet, which experts quickly flagged as suspicious.

Binance founder Changpeng Zhao stated in an X post that receiving crypto through a private key or hardware wallet is a “bad idea,” citing “several instances” where this has occurred.

Recently, I have seen several instances where people receive crypto by receiving a private key or a hardware wallet.

This is a bad idea.

The giver still has access to those crypto. You should move the crypto to an address you own. Or better, just ask the giver to send it to…

— CZ ? BNB (@cz_binance) December 22, 2024

A seed phrase is a unique sequence of words needed to access a cryptocurrency wallet, and sharing it openly can lead to theft. Kaspersky notes that the comment appeared to be from a beginner, with other similar comments following, all from “from newly created accounts.” These messages contained seed phrases and requests for assistance with fund transfers.

In the scam, a thief accessing the wallet would find it filled with Tether’s (USDT). However, to withdraw the funds, the thief would need TRON (TRX).

“Unfortunately, the wallet doesn’t have enough TRX, so the thief tries to transfer TRX from their own personal wallet — only to discover that the tokens they transferred immediately ended up in a completely different, third wallet.”

Kaspersky

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The trick lies in the wallet’s multi-signature setup, the analysts say, adding that this type of wallets requires approval from multiple parties to authorize transactions. As a result, even if the scammer paid the necessary fees, they would not be able to steal the funds.

Kaspersky warned that this scam is an example of how scammers can manipulate thieves, encouraging users to avoid sharing seed phrases and to stay cautious of similar schemes. In June, the Biden administration imposed sanctions on 12 senior leaders at Kaspersky Lab, citing cybersecurity risks, a day after announcing plans to ban the sale of the Russian company’s antivirus software.

Read more: North Korean hackers target crypto firms with ‘Durian’ malware, Kaspersky confirms

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