By taking advantage of flaws in virtual systems and user behavior, such as malware infections, phishing scams, and illegal access to personal and financial information, cybercriminals take advantage of the metaverse.
Cybercriminals can target the metaverse in a number of ways, including:
- Phishing Scams: Thieves may employ phishing techniques to trick victims into revealing personal information or login credentials, which can then be used for identity or data theft or other illegal acts.
- Hacking – To steal money or personal information, criminals may attempt to hack user accounts or metaverse platforms.
- Malware – To access sensitive data or perform illicit operations, criminals can use malware to infect virtual environments or devices that support the metaverse.
- Scams: Criminals can take advantage of the anonymity and lax regulation of the metaverse to carry out scams such as Ponzi or pyramid schemes.
- Ransomware – Thieves can use ransomware to encrypt a user’s digital possessions or personal data before demanding payment in exchange for the decryption key.
- Exploitation of virtual goods and assets: Cybercriminals can use bots or other tools to buy virtual goods and assets, which they then sell on the black market for real money.
- Fake Digital Asset Creation – Criminals can create fake virtual assets and sell them to unsuspecting buyers, causing victims to suffer financial loss.
- Social Engineering: Thieves can take advantage of the social elements of the metaverse to gain people’s trust before defrauding them.
Related: How are metaverse assets taxed?
The “Crypto Crime Cartel” case is a real-world instance of cybercrime in the metaverse. In 2020 it was discovered that a group of cybercriminals had been working in the metaverse, more specifically in the Second Life online community.
They tricked customers into submitting personal and login information via a phishing scam, which they then used to steal virtual money and digital assets. The group also committed identity theft and other financial crimes in the real world using the stolen information. Money laundering crypto criminals managed to steal millions of dollars worth of digital assets and coins.
This example demonstrates how cybercriminals can use the anonymity and lax regulation of the metaverse to carry out illegal acts. It emphasizes the importance of being careful when using virtual worlds and taking precautions to safeguard private data and digital assets, such as using strong passwords, being wary of unsolicited requests for personal information, and notifying the proper authorities of any suspicious activity.
The Decentral Games hack is just another instance of financial crime in the metaverse. A group of hackers attacked Decentral Games, a well-known metaverse gaming site built on the Ethereum blockchain, in 2021 by exploiting a flaw in the smart contract. They were able to steal Ether (ETH) and other cryptocurrencies worth more than $8 million from network users.
This illustration shows how susceptible smart contracts and decentralized systems can be to hackers and other types of cyberattacks. It also demonstrates how the lack of oversight and regulation in the crypto and metaverse industries can make it easier for criminals to commit cybercrime and steal substantial sums of money.
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