Scam bots have proliferated YouTube, with investigators recording a massive spike in fraudulent videos, data from blockchain security company CertiK found this week.
The company said it its findings that bot-based scams promised high daily returns up to 10 times, but would later steal funds contributed from users.
CertiK found in its report that a massive jump of 500 percent in 84 percent of “front running bot” scam videos, or from 28 to 168 fake over the past year.
NOVEMBER WAS WILD. 🤯
— CertiK (@CertiK) December 1, 2022
~$596M lost to exploits, hacks & scams 😮
2nd worst month in terms of FUNDS LOST in 2022 😬
$29.7M were exit scams 🚩
~$5M were Flashloans 😣
(via @CertiKAlert)
See the details below 👇 pic.twitter.com/i8LwC6h2Ph
The report noted: “There are common themes in all of these videos: free code and huge returns. Successful runners won’t give away free code on a social media site, they will sell it for a large amount on underground forums.”
According to the findings, front running involves insider knowledge of unconfirmed transactions to trade, leading to massive profits.
Bots would later steal assets from users attempting to conduct front-running transactions. They can also scan for unconfirmed transactions by analysing blockchain contents, then pay higher gas fees to advance transactions ahead of others.
Scammers also offered fake tutorials on using the bots, but would also spam comment sections with positive reviews.
Scam Bots, Sham Businesses
According to Bitcoin.com, the rise of trading bots have contributed to immense speculation in the cryptocurrency market, with many promising winning trades or higher returns. Many novice crypto traders have lost significant money to these devices.
The report cited a South African Mirror Trading International (MTI) scam, which stole from tens of thousands of people on claims the bots could earn users consistent returns.
South African and US-based regulators later cracked down on MTI investments, with the company later collapsing after its chief executive Johann Steynberg disappeared with investors’ money. The platform failed to provide high returns and was written off as a scam enterprise.
