A crypto investor has lost more than $282 million in Bitcoin and Litecoin after falling for a social engineering scam involving a hardware wallet.
On January 16, on-chain investigator ZachXBT revealed the massive theft, which reportedly drained the victim’s account of 2.05 million Litecoin (LTC) and 1,459 Bitcoin (BTC).
SponsoredMonero Spikes 36% After Hacker Swaps Stolen Crypto Into Privacy Coin
Cybersecurity firm ZeroShadow confirmed that the attacker executed the heist by impersonating Trezor customer support. Trezor is a major hardware wallet provider with over 2 million users.
The impostors successfully manipulated the victim into revealing their recovery seed phrase, effectively handing over full control of the assets.
Following the breach, the perpetrator immediately began laundering the stolen funds.
ZachXBT reported that the attacker utilized multiple instant exchanges, specifically Thorchain, to bridge the stolen Bitcoin into Ethereum, Ripple, and Litecoin.
Meanwhile, the attacker’s reliance on Thorchain has drawn sharp criticism toward the decentralized infrastructure provider.
ZachXBT noted that this was not the first time bad actors have leveraged the platform for such purposes. This indicates that it remains a preferred destination for criminals seeking to move stolen wealth.
Simultaneously, the hacker converted a significant portion of the loot into Monero (XMR), a privacy-focused token designed to obscure transaction details.
“ZeroShadow tracked the outbound flows and froze over $1M before it could be swapped into XMR. The activity that could get through is likely increasing XMR’s price,” Zero Shadow stated.
Notably, this aggressive buying spree triggered a significant price increase in the Monero market.
Data from BeinCrypto shows the token surged more than 36% over the seven-day period, reaching a peak of nearly $800. The asset has since corrected to approximately $621 as of press time.
This incident underscores a widening security crisis within the digital asset sector. Attackers are shifting tactics, prioritizing social engineering and brand impersonation scams over technical code exploits to deceive victims.
Blockchain analytics firm Chainalysis quantified the trend, reporting a 1,400% year-over-year surge in impersonation scams. The firm also said the average financial loss per incident has increased by more than 600%.