A recent case highlights how scammers exploit preloaded hardware wallets to steal cryptocurrency. A woman's experience of losing 4.35 BTC serves as a cautionary tale.
Incident of Bitcoin Loss
According to blockchain security firm SlowMist, a woman lost 4.35 BTC, approximately $250,000. She purchased an imToken hardware wallet from a now-defunct store on JD.com. After transferring her Bitcoin holdings in multiple batches from the OKX exchange, she discovered her wallet balance was zero and found that all her funds had been sent to other addresses by a malicious actor.
Understanding Hardware Wallet Scams
Scammers frequently sell activated wallets that they have access to after recording the seed phrase. The victim in this case did not reset the wallet before using it and failed to generate her own seed phrase.
Five Safety Tips
To prevent falling for similar scams, hardware wallet users should keep in mind these recommendations:
1. Purchase hardware wallets only from official brand websites, avoiding marketplaces. 2. Never use the seed phrase that comes with the wallet, as a new one should be generated. 3. Always reset (initialize) the wallet before use. 4. Transfer small amounts of crypto before making large transactions. 5. Educate yourself about how hardware wallets work.
The incident of losing a significant amount of money through a preloaded hardware wallet scam emphasizes the importance of adhering to security practices when dealing with cryptocurrencies.
