Malicious Crypto Trading Bot Scam Using Fake YouTube Accounts to Steal Funds

A new warning from cybersecurity firm SentinelLABS has revealed a widespread scam targeting cryptocurrency users. The scam involves seemingly legitimate YouTube channels promoting a crypto trading bot, which, once deployed by the victim, hides a smart contract designed to steal funds. The fraud has been ongoing since at least 2024, and it is continuing to spread through social media and video platforms, where scammers are luring unsuspecting users into a trap.

According to Alex Delamottea, a senior threat researcher with SentinelLABS, these malicious YouTube accounts often feature videos that claim to offer trading tips or provide smart contract code to deploy a crypto trading bot. However, once victims interact with the content and deploy the bot, the attacker’s wallet is secretly added to the contract. When the victim funds the contract, the attacker can drain their funds.

The scam relies on the victim depositing funds—typically at least 0.5 Ether (ETH), currently worth $1,829—into the contract. This amount covers gas fees and ensures that the victim’s profits seem enticing. However, once the victim adds their funds to the contract, the scammer’s wallet is disguised as a legitimate trading address and is silently given access to steal the deposited Ether.

“The cryptocurrency ecosystem is increasingly complex, and scams like these will inevitably succeed against victims who do not thoroughly analyze how related tools work,” said Delamottea. So far, the scam has drained over 256 Ether, with the scammer’s wallets collectively holding over $939,000 worth of stolen crypto.

The Role of Fake YouTube Accounts and AI-Generated Content
The scam is made more believable by using older YouTube accounts, which appear credible due to their history of posting crypto news, investing tips, or other pop culture content. These accounts often rank higher on YouTube, making them seem more legitimate.

While it’s unclear if these accounts were created by the scammers or purchased through channels like Telegram, Delamottea noted that several videos promoting the scam are AI-generated. This makes it easier for scammers to churn out multiple videos without needing to assume a new identity or maintain a personal presence. These videos often delete negative comments, while fake testimonials flood the comment section, falsely claiming that users have profited from the bot.

In addition, many savvy crypto users are turning to Reddit and other platforms to warn others, as the scammer’s comment moderation makes it difficult to find honest feedback directly on YouTube.

The growing prevalence of these scams highlights the ongoing vulnerability of crypto users to misleading trading tools promoted through social media. Delamottea advises users to approach any trading tool or bot promoted in unverified videos or social media posts with extreme caution, particularly if it promises “quick, easy profits.”

“Scams like these are becoming more common because they work for the bad actors,” Delamottea warned. She emphasized the importance of conducting thorough research before deploying any trading tool, especially when it promises high returns with little to no risk.

Crypto traders are advised to always validate the legitimacy of the tool and its functionality. Avoid deploying smart contract code or tools recommended in videos that seem too good to be true, as these are often red flags for scams.

How to Protect Yourself from These Crypto Scams
To protect yourself from falling victim to this type of scam, consider the following steps:

Do Your Own Research: Never trust a crypto trading tool simply because it’s promoted by an influencer or featured in a high-ranking video.
Validate Code and Contracts: Always review the smart contract code or have it audited by trusted sources before deploying it.
Question the “Too Good to Be True” Promises: If a bot or tool promises easy profits with no effort or risk, it’s likely a scam.
Avoid Bots Promoted on Social Media: Trading bots promoted through unverified content on YouTube, Twitter, or other platforms should be treated with skepticism.
Look for Red Flags: Watch out for AI-generated videos, deleted negative comments, or too many overly positive testimonials in the comment sections.

The rise of malicious crypto trading bots hidden in seemingly legitimate YouTube videos serves as a stark reminder of the importance of due diligence in the cryptocurrency world. While the allure of quick profits can be tempting, the risks of scams like this can be devastating. Crypto traders must exercise caution, validate all tools and resources, and stay vigilant against scams that prey on those looking for fast returns.

By taking the time to scrutinize what’s behind the tools they use, crypto users can better protect themselves from falling victim to such deceptive schemes.