“Crypto Assaults”: Thieves in London Target Digital Investors by Taking Phones | Cryptocurrencies

Thieves are targeting digital currency investors on the street in a wave of “crypto muggings”, police have warned, with victims reporting thousands of pounds stolen after their mobile phones were seized.

Anonymous crime reports provided to the Guardian by City of London Police, as part of a Freedom of Information request, reveal that criminals combine physical muscle with digital savvy to keep people apart of their cryptocurrency.

A victim said she tried to order an Uber near Liverpool Street station in London when attackers forced her to hand over her phone. While the gang eventually returned the phone, the victim later realized that his account with crypto investment platform Coinbase was missing £5,000 of Ethereum digital currency.

In another case, a man was approached by a group of people offering to sell him cocaine and agreed to walk down an alley with them to close the deal. The men offered to type in a number on his phone, but instead accessed his cryptocurrency account, holding him up against a wall and forcing him to unlock a smartphone app with face verification. They transferred £6,000 worth of ripple, another digital currency, out of his account.

A third victim said he vomited under a bridge when an attacker forced him to unlock his phone using a fingerprint, then changed his security settings and stole £28,700, including cryptocurrency.

In another case, a victim told police his cards and phone were stolen after a night out at the pub, with £10,000 later stolen from their account with investment platform Crypto.com. The victim was using his phone in the pub and believed the thieves saw him typing in his account PIN, according to the report.

“It’s a kind of crypto assault,” said David Gerard, the author of Attack on the 50 Foot Blockchain, a book about digital currencies.

Cryptocurrency transfers are irreversible, unlike a wire transfer, which makes this type of crime more attractive to thieves.

“If I get robbed and they force me to do a wire transfer, the bank can trace where the money went and there are all kinds of returns. You can reverse the transaction.

“With crypto, if I transfer it to my crypto wallet, I have your coins and you can’t get them back.”

He said the risks were exacerbated by the way some people manage their smartphone investments, without exercising the same degree of caution as with cash. “People keep stupid amounts of money in crypto accounts. They don’t think it’s money one way or the other.

Gurvais Grigg, a 23-year veteran of the FBI, now works as a director of public sector technology for Chainalysis, which helps government agencies and financial institutions track digital currency movements.

He said the nature of cryptocurrency, where transactions are recorded on the blockchain, meant that police should, in theory, be able to track stolen crypto.

“For [transfer stolen assets], they must provide a wallet address and most likely they will use this wallet address again in the future. You also need to take it to an exchange if you want to turn it into fiat currency.

He said it created a digital paper trail that investigators can use, and regularly use, to track down multi-million dollar crypto hacks. However, he said they were less likely to have the resources to prosecute smaller, one-off crimes.

“An individual theft of a small amount may not attract the attention of the police or a large law enforcement agency.

“If they could put together a bigger plot of activity, where people do it more than once or twice, the police departments would probably pay attention.”

The crypto attacks took place in the second half of 2021, in the relatively small part of London’s financial district patrolled by the City of London Police.

The incidents are not the first in which people have been forced to hand over cryptocurrency under threat of violence.

A student from Kent claimed last year that eight people stormed his university accommodation and forced him to transfer £68,000 worth of bitcoin at knifepoint.

Later that year, American tech entrepreneur Zaryn Dentzel told police he had been attacked at his home in Madrid by masked thieves. He said they tortured him with a knife and a stun gun before disappearing with millions of euros in bitcoins.

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However, the nature of crimes reported in London last year – seemingly opportunistic street incidents akin to an assault on cash or valuables – present new challenges for police.

Phil Ariss, who leads the cryptocurrency team for the National Council of Chiefs of Police’s cybercrime program, said more training is being provided to police officers on a variety of crypto-related crimes.

He said the police are also looking for ways to educate the public about the need to be careful when accessing a crypto account.

“You wouldn’t be walking down the street with £50 notes and counting them. This should apply to people with crypto assets,” he said.

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