Building a Scam: Crafting Deception in Crypto (Part 1)

We’ve recently discussed the ways that scammers of all levels approach and attract their victims, how they use what they know about what their targets want, and how they employ simple tactics to leverage human nature and then manipulate people into making costly decisions.

In this article and the next, we will explore how old con techniques are being applied to crypto and gambling in 2023/24 by designing our own crypto product – a scam coin – and using various simple but powerful techniques to build a fraud and understand deception from the inside out.

Naturally, we must begin with a few caveats and cautions.

This may read like a template for criminal deception, but in my (expert) opinion, real scammers don’t need our help to design con games or commit fraud. If this article inspires you to try stealing from others, you’re probably already on the path to criminal prosecution.

That’s an awful lot of hedging just to talk about how a scam might be constructed.

But trust me when I tell you that moronic crooks love a good excuse [for their actions] and wouldn’t hesitate to claim they were on the straight and narrow before reading a book or seeing a movie, or reading a blog about whatever crimes they are caught committing.

In fact, moronic crooks might be exactly who targets us the most! Just because they have the IQ of a tin of baked beans doesn’t mean they can’t trap a much bigger intellectual game. 

We’ll get into that phenomenon later. 

One last qualifier before we delve into our virtual crypto scam:

I’m well aware there’s much more to the process than we are about to discuss here, but I want to talk in broad terms without getting bogged down in how to highjack legitimacy with liquidity pools or any complex details specific to crypto where others have much more expertise than I do. 

We will explore those nuances another time, but this article is about the principles of deception, so let’s keep it simple.

STEP ONE: The Bait

We know our targets are seeking profits and that they’re willing to take risks, but in the current marketplace, caution [on the part of investors] is always a factor.

So we need to create a prize to attract as many potential marks (victims) as possible to maximize our potential gains.

Let’s start by searching for a legitimate deal that we might be able to emulate.

As it happens (in our imagined scenario), there’s a recent limited token release that has netted extremely strong profits for early investors as soon as the token leveled out to become a (relatively) stable currency.

We need to see:

• How did that release work
• What elements contributed to its success
• What can we copy to appear similar in potential value?

Perhaps the release was from a trusted or famous source?

So reputation played a part in the token’s initial success, ensuring it opened with a strong foundation of buyers therefore making an investment before general release a wise (ultimately profitable) risk.

So our bait is a phantom token that will be released sometime in the future with support from a high-profile organization or individual. And just like our legitimate template – our token will be pre-sold to a guaranteed pool of investors, meaning huge profits for those who can get in ahead of that release.

We have our bait, so let’s give it a name – we’ll call it the SCAM COIN (which it is), and we will target online gamblers with an angle that’s bound to attract interest from a specific group where we can target our research.

STEP TWO: The Line (Part 1)

So now we have our fake prize, we need to spread the word, and the way to do this is with a believable but attractive story. What we’re creating is a lie, but the best building blocks for that lie should be based on truth. 

For a jam auction, scammers set up their store where they expect to find people looking for bargains – often on a high street – but for our purposes, we need to find people willing to take risks on crypto, and these prospectors can be incredibly easy to find on forums and social media.

Even when potential marks use sock accounts to hide their identity while discussing financial matters in public, connecting with those accounts might still reach the real person behind that account.

Specificity isn’t important if you can identify potential victims who have expressed certain opinions or match certain psychological profiles. What do I mean by that?

Let’s say you can recognize more impulsive or less knowledgeable people by analyzing the words they use in online discussions (which you can), and you have your software cull names in separate bins based on characteristics suggested by words used in those discussions.

You now have a list of potential victims that can be approached according to their likely experience and expertise, then communicate with each group in a manner appropriate to their apparent knowledge OR stated opinions. 

This is a type of suckers list.

Thanks to the information gathered while compiling that list, we have a nuanced understanding of each potential mark’s likely weaknesses or strengths and can use that information to our advantage when we hit them with our story in advance of a proposition.

To Sum Up

So far, we’ve created our fake product and gathered a list of potential customers (victims), which we’ve divided into groups to identify the most vulnerable and the most dangerous marks.

But we can also deduce who might have the most money and whether vulnerability and wealth happen to converge with primary targets for our scam.

In our next article, we will attempt the most difficult part of any scam: The approach.