Contra Trade: New crypto rip-off discovered
Contra Trade is a new crypto scam that has already cost users millions of dollars. There is probably a technical error in the background, but the developers responsible have not shown any reaction so far.
What is a contra trade in the crypto world?
The term Contra Trade is already known from TradFi and describes a process in which a financial asset is repeatedly bought and sold. In one specific incident, such a contra trade occurs on a crypto exchange, Wu Blockchain reports.
In this case, the contra trade proceeds as follows: An unauthorized person gains access to his victim’s trading account. Possibly for technical reasons, he trades his target’s funds for his own benefit.
In practice, it looks like this: The person responsible sells as small a cryptocurrency as possible , which he acquires with the victim’s account. The attacker gets valuable, popular investments.
The responsible person then sells the purchased cryptos against recognized cryptos before starting the next purchase of the insignificant currency. This is how the unauthorized person gives himself money.
FTX becomes target of crypto rip-off
According to Wu Blockchain , FTX has repeatedly become the target of scams in recent days. The attack vector is a trading interface provided by the company 3commas.
The attacker used the DMM: Governance (DMG) cryptocurrency , which he traded against his victims ‘ higher-value Bitcoin , Ethereum , and FTX tokens . On October 19th, a user noticed that his FTX trading account was unintentionally buying and selling DMG 5,000 times.
So far, the user has been left with significant damage. The attacker got the equivalent of around 1.6 million US dollars. Several users, meanwhile, came to Wu Blockchain and reported losses in the same way.
When users contacted the crypto exchange FTX, they reported that an interface from the company 3commas was to blame for the misery. The FTX customer, who had to accept the loss of millions, reported the incident to the police.
According to him, FTX has not shown any reaction and has not frozen the thief’s accounts. 3commas stated that there were no errors in the system and that the technology was unaffected.
API exposes private keys?
It has therefore not yet been possible to definitively determine whether it is a question of personal errors or whether technical failure is actually the cause. A user spoke up on Twitter. In his estimation, the 3commas API exposes the user’s private keys.
If an unauthorized person reads the information, he could therefore gain access to the cryptocurrencies concerned.