US Secret Service Disrupts $4.3M Ethereum Phishing Scam in Operation Avalanche

The U.S. Secret Service, alongside Canadian authorities, has successfully disrupted a major Ethereum phishing scam that led to losses of $4.3 million.

The U.S. Secret Service, in collaboration with Canadian authorities, has successfully disrupted a major Ethereum phishing scam that resulted in losses of $4.3 million, officials announced on Monday.

The operation, codenamed “Operation Avalanche,” focused on a phishing scam targeting Ethereum users and involved a coordinated effort to track stolen funds and prevent further damage to digital wallets.

The U.S. Secret Service collaborated with several Canadian agencies, including the British Columbia Securities Commission (BCSC), to counter this scam. The joint operation brought together securities regulators, police, crypto trading platforms, and blockchain analysis firms.

This multi-agency force aimed to identify compromised digital wallets on the Ethereum blockchain, warn the affected wallet holders, and ultimately prevent further losses.

“The operation engaged multiple sectors in both the U.S. and Canada to safeguard individuals against fraudulent crypto activities,” said Special Agent in Charge Matt McCool of the U.S. Secret Service.

These partnerships are crucial in addressing the growing threat of crypto fraud, which becomes increasingly difficult to handle due to its borderless nature.

The primary method used in the scam was “approval phishing,” where fraudsters deceived victims into making fraudulent transactions on their wallets. In this scheme, victims would unknowingly grant access to their funds by clicking on a deceptive link or approving a fraudulent transaction.

After gaining access, the attackers could swiftly withdraw funds from the compromised wallet.

During the U.S. Secret Service operation, authorities identified and reached out to victims affected by this crypto scam. They notified the victims of the risk and encouraged them to take the necessary steps to secure their wallets.

This approach is part of a broader effort to educate crypto users and prevent future scams.

“By identifying these wallets, we were able to warn victims before they lost any more funds,” said Bonnie Lysyk, Executive Vice President of Enforcement at the Ontario Securities Commission (OSC).

The OSC, along with other Canadian authorities, played a crucial role in identifying the compromised wallets and alerting users in real-time.

Amid the success of Operation AVALANCHE, the necessity of international cooperation in the fight against crypto fraud was proven. Just as the market is expanding at blinding speed, the threats of fraud in the sector also increase.

In addition to the success of Operation AVALANCHE, another recent crypto security breach, which involved the ZK token, led to the loss of $5 million belonging to one of the admin accounts.

Amid these moves, the U.S. Secret Service has been taking measures to safeguard users by leveraging technology and cooperation to mitigate criminal activities in cryptospace.

Last month, the U.S. Secret Service also attempted to shut down website domains associated with a Russian cryptocurrency exchange and block assets related to illegitimate use.

Such operations are a clear indication of the Secret Service’s desire and attempt to protect the country’s financial sector.

”As a result of these actions, it is important for us to unmask the criminals who take advantage of the victims and the financial systems,” said McCool. “We will exercise constant cooperation with LOAs, both domestic and foreign, to prevent other frauds and recover the stolen funds for their owners.”