29th November 2022 > > Crypto staking part 5.

tl;dr

The SEC vs XRP court case rumbles on.

Market Wrap

Market Wrap

Crypto lender BlockFi is the latest victim of the fraudulent fiasco at FTX, filing for bankruptcy yesterday. This has had little impact on crypto prices as it comes as no surprise as BlockFi had been bailed out with a $400m revolving credit line from FTX after losses stemming from the collapse of 3AC and Celsius earlier this year.

In a stunning understatement, rating agency Fitch stated that the bankruptcy filing raises alarm bells.

Curious Cryptos’ Commentary – Crypto staking part 5 – fraud alert

On 26th November the CCC gave a brief overview of some of the possibilities for staking ETH. I was reminded of an earlier piece on 21st February 2022 that gave warning of a very convincing scam on this very topic. It is still relevant, and It is worth re-reading once more. Here it is.

Curious Cryptos’ Commentary – ** ETH STAKING SCAM ALERT **

Regular readers are familiar with the process that ETH is undergoing to move from PoW (Proof-of-Work to PoS (Proof-of-Stake). When complete, this transition will have several benefits including shorter settlement times and far cheaper fees.

There is a complex debate about the relative merits of PoW compared to PoS in terms of security, and even in terms of the environmental harm or otherwise, but those debates need not concern us here – the decision has been taken and the process is underway.

As part of the transition, owners of ETH have had the opportunity to stake their holdings, in return for rewards that seem to be around 10-20% APY last time I looked. Stakers will be unable to unstake until the transition is complete.

…

Today I received an extremely convincing email purportedly from the “ETH Foundation” offering immediate 25% ETH rewards for staking now.

If you click on the link, you are taken to an extremely convincing website with this address:

https://staking-ethereum.org/en/eth2/staking/

It is a secured website, and the name contains ethereum.org. The unwary and less sceptical ETH owner than I might take that at face value and head on over to start staking.

Anyone that has done that has lost all their ETH to a scammer. I shall explain why.

…

1. The “From:” on the email was no.reply@beastmarts.com.

2. Right at the bottom of the email is the only spelling mistake notices@ethereunn.org.

3. The website address had “staking - “ before ethereum.org.

4. The offer was to pay 25% APY upfront, which is not how fees are earnt.

5. The offer is limited to the first 550,000 ETH to take up the offer, with a countdown timer adding to the tension of FOMO.

6. There is a claim that each wallet can only stake once, meaning that testing the offer with a small amount of ETH to see if it is a scam is pointless – “… a second operation will not be

allowed”.

7. There is a link to join a reddit site “r/ethstaker” but this is entirely independent of the Ethereum Foundation and would not be promoted by them.

By this time, I was getting more and more convinced that this was a scam.

So, I headed on over to the official Ethereum website:

https://ethereum.org/en/

The two sites are almost identical except for the staking page – the official ethereum.org website makes no mention of staking directly with them at all, let alone for a 25% upfront payment.

…

The scammers always appeal to your sense of greed. Please do not fall for it.