TechFlow reports, citing The Block, that according to an analysis by Blockfence security researchers, criminals have created over 1,300 fraudulent cryptocurrency tokens since April 2023, stealing $32 million from more than 42,000 victims.
The operation runs largely automated, creating a token that typically mimics a company or project that hasn't yet announced or launched its own token. False trading volume is then introduced to lure in traders. If sufficient legitimate funds are attracted, the scammers—assuming there's more than one—cash out and repeat the process over and over.
Although the token contracts appear to pass several security checks, in reality, the fraud operators retain the ability to arbitrarily burn holders' tokens, mint unlimited tokens for themselves (even though the tokens appear locked), and falsify the maximum supply of the token.
