As the Web3 ecosystem continues to grow, so does the threat of crypto scams.
Recently in the news, the Australian Securities and Investments Commission (ASIC) reported having uncovered and shut down over 600 cryptocurrency investment scams in just one year, highlighting the increasing sophistication and prevalence of these threats. Even more concerning is the fact that the 600+ operations that were shut down comprises a mere 9% of the 7000+ total phishing and scam investment websites identified.
These somewhat alarming statistics are part of a broader trend where scammers exploit new technologies like artificial intelligence to deceive unsuspecting investors.
The Anatomy of a Modern Crypto Scam
Cryptocurrency scams today are not just about tricking individuals into sending funds to a fraudulent address. They have evolved into complex schemes, keeping up with the growth of the typical Web3 user. Today’s scams often involve fake investment websites, phishing attacks to steal personal data, false promises of AI-powered trading systems that guarantee unrealistically high returns or falsely claimed international regulation. ASIC’s crackdown on these operations is a clear indication that the landscape of financial crime is adapting quickly to the innovations within the Web3 space.
The Role of AI in Amplifying the Scam Threat
One of the most concerning developments is the use of AI by scammers. While these emerging technologies are beneficial in many aspects, they can also provide tools for criminals to automate and enhance their scams, sometimes multiplying the potential damage. This can include creating convincing fake identities, automating phishing attacks and even generating fraudulent financial reports that appear entirely legitimate to the untrained eye.
As the Gala ecosystem continues to advocate for decentralized technology and the empowerment it offers, it’s crucial that our community remains vigilant against these emerging threats. Awareness is the gateway to knowledge, and knowledge is power and safety in this new Web3 world.
ASIC’s Efforts: A Wake-Up Call for the Global Crypto Community
ASIC’s successful takedown of 615 crypto investment scams serves as both a warning and a call to action for the global Web3 community. With Australians losing an estimated A$1.3 billion to these scams in the last year alone, the scale of the issue is undeniable. This is not just a problem for regulators but for every participant in the Web3 space, including those within the Gala community.
GalaChain’s Commitment to Security and Education
At Gala, we are committed to creating a safe and secure environment for all our users. GalaChain, our purpose-built Layer 1 blockchain, is designed with security at its core. Our ecosystem includes robust measures to protect against malicious activities and ensure that users can engage with Web3 technology safely. However, technology alone is not enough. Ongoing self education and awareness are key to avoiding and preventing scams.
We encourage our community to stay informed about the latest threats and to always verify the legitimacy of any opportunities in the Web3 space. Remember, if something sounds too good to be true, it probably is.
Building a Safer Web3 Future Together
The fight against crypto scams is a collective effort. As we continue to build and expand the Gala ecosystem, we must all remain vigilant and proactive in protecting ourselves and each other. By fostering a well-informed and cautious community, we can mitigate the risks and continue to enjoy the benefits of decentralized technology without falling victim to fraudulent schemes.
The content of this article is not investment advice.
As we continue to explore the many avenues that can lead to the widespread adoption of blockchain tech, one financial instrument has been making waves in both traditional finance and the emerging Web3 space—Exchange-Traded Funds (ETFs).
With vastly increased attention over the past few months, it’s clear that ETFs will play a significant role in driving mainstream acceptance of blockchain and Web3 technologies. But what exactly are ETFs, and why are they so crucial to the mass adoption of Web3? Let’s dive in.
What Are ETFs? Breaking It Down
An Exchange-Traded Fund (ETF) is a type of investment fund and exchange-traded product that holds assets such as stocks, commodities or bonds. ETFs are traded on stock exchanges like individual stocks. This means they can be bought and sold throughout the trading day at market price, which fluctuates with the value of the underlying assets within the particular ETF.
The Appeal of ETFs
In the more traditional world of finances, ETFs have gained popularity because they offer investors exposure to a wide array of assets without requiring them to buy each asset individually. For instance, an investor can buy shares of an ETF that tracks the performance of the S&P 500, thereby gaining exposure to the top 500 companies in the U.S. stock market with a single purchase. This convenience, combined with generally lower fees compared to mutual funds, makes ETFs an attractive option for both novice and seasoned investors.
ETFs and the Web3 Ecosystem: A Perfect Match?
Bridging Traditional Finance and Blockchain
The connection between ETFs and crypto is becoming increasingly significant. As blockchain-based assets continue to steadily gain traction, the introduction of ETFs that track some of these assets allows traditional investors to gain exposure to the blockchain space without directly buying or managing cryptocurrencies.
In the same way that the traditional financial system can appear mysterious and daunting to many early adopters of web3, it can be difficult for traditional investors to dive directly into the web3 pool. ETFs present a shallow end with easier entry, allowing those investors to first get their feet wet without becoming overwhelmed by the less regulated deep end.
Essentially, ETFs are particularly appealing to those who are curious about blockchain but wary of its volatility and technical complexity.
Accessibility: ETFs provide a familiar and regulated investment vehicle for traditional investors to explore the world of blockchain. This ease of access is crucial for onboarding new users to the Web3 space, where unfamiliarity has consistently proven itself a significant barrier.
Institutional Interest: The approval and adoption of blockchain-based ETFs by regulatory bodies signal a growing institutional acceptance of blockchain. As large financial institutions enter the space through ETFs, legitimacy is lended to the entire Web3 ecosystem, encouraging a community of increasingly more conservative investors to participate.
Market Stability: By providing a diversified and regulated way to invest in blockchain technology, ETFs can help stabilize the market. This can reduce the extreme volatility often associated with cryptocurrencies, making the Web3 space more attractive to the general public. As more traditional money flows into these markets, they generally will become more difficult for whales to manipulate.
The Road Ahead: ETFs as Catalysts for Mass Adoption
Looking back several years from now, ther’s a good chance that 2024 will be remembered as the “year of the ETF” in the same way that 2018 was all about ICOs and 2021 centered around NFTs.
ETFs represent a bridge between the traditional financial system and the emerging world of Web3, and bridges are incredibly important when it comes to mass adoption. By offering a regulated, accessible and relatively low-risk entry point into blockchain, ETFs are likely to play a pivotal role in bringing blockchain technology into the mainstream.
As we continue to develop the GalaChain ecosystem, we recognize the importance of such instruments in shaping the future of Web3. By keeping an eye on these trends, we position ourselves—and our community—at the forefront of the blockchain revolution.
The first Bitcoin ETFs were approved by the US Securities and Exchange Commission (SEC) in the first weeks of 2024, with a total of 11 BTC ETFs approved, opening the floodgates.
In mid July, Ethereum-containing ETFs were finally approved for market trading. “We’ve now fully entered the ETF era of crypto. Investors can now access more than 70% of the liquid crypto asset market through low-cost ETPs,” said Matt Hougan, Chief Investment Officer at Bitwise.
There is a constant flow of news in the financial sector about crypto-related ETFs. Such extensive intersection of crypto and traditional finance is unprecedented.
At Gala, we’re not looking to make any predictions or speculations about token prices, and we’re not offering financial advice of any kind. We support the empowerment that comes with adoption of blockchain technology, regardless of how that empowerment interacts with markets. When we see the mainstream financial world (and its most trusted regulators) paying more attention to cryptocurrency, we recognize that global awareness of web3 is on the rise.
We encourage our readers to stay informed and try to keep up with the latest developments at the intersection of centralized and decentralized finance. Knowledge is empowerment, especially in the web3 world.
The intersection of ETFs and blockchain is a powerful indicator of how traditional finance and emerging technologies are beginning to converge. As we look to the future, ETFs could very well be the key that unlocks widespread adoption of Web3 technologies. At Gala, we are excited to be part of this journey and are committed to leading the charge in integrating these financial innovations into our ecosystem.
In the simplest terms, a hash is like a digital fingerprint for data.
Imagine you have a piece of information—a document, a photo or even a piece of text. When you run this information through a hash function (a specific type of algorithm), it generates a unique string of characters called a hash. No matter the size of the original data, the resulting hash is always of a fixed length. This is a key feature of hash functions: They condense data into a fixed-size output.
Think of it like shredding a document and then encoding the resulting pile of shredded paper into a fixed-sized box. No matter how long or short the original document was, the box is always the same size, and it’s nearly impossible to reconstruct the original document from the box alone. Similarly, it’s computationally infeasible to revert a hash back into its original data.
Hashes are foundational to many blockchain technologies, including cryptocurrencies like Bitcoin and Ethereum. They are integral to how blockchain ensures the integrity and security of data. Here are some key reasons why hashes are so important in Web3:
Data Integrity: Hashes ensure that the data hasn’t been altered. When data is hashed, even the slightest change in the input (like changing a single letter in a text) will produce a completely different hash. This makes it easy to detect tampering or corruption.
The decentralized internet as we know it is possible through the use of hash functions, as demonstrated by the Interplanetary File System and its distributed hash table. IPFS uses hash functions to verify the integrity of all data shared to what has become known as the decentralized internet. In fact, Gala Founder’s Nodes power a large portion of this data, giving the Gala ecosystem a large share in the responsibility of web3’s future.
Blockchain Security: In blockchain, hashes are used to link blocks of data together. Each block contains the hash of the previous block, forming a chain. If someone tries to alter the data in a block, the hash of that block changes, which then changes the hash of the subsequent block, and so on. This makes it extremely difficult to alter any information in the blockchain without detection.
Efficient Data Storage: Hashes allow large amounts of data to be represented by a small, fixed-size string. This makes storing and verifying data in blockchain systems much more efficient.
Proof of Work: In cryptocurrencies like Bitcoin, hash functions are used in the mining process. Miners compete to find a hash that meets certain criteria (e.g., it must start with a certain number of zeros), which requires computational power. This process, known as “proof of work,” secures the network and adds new blocks to the blockchain.
How Hashes Work
To dive a bit deeper, let’s explore how a hash function works. A common hash function used in blockchain is SHA-256 (Secure Hash Algorithm 256-bit). When you input data into SHA-256, it generates a 256-bit (or 64-character) hash. No matter what data you input—a single letter or an entire book—the output is always 64 characters long.
For example:
The text “Hello, World!” might hash to something like a591a6d40bf420404a011733cfb7b190d62c65bf0bcda32b575a0f76c6e53a2e.
If you change it to “Hello, world!” (note the lowercase ‘w’), the hash could be 64ec88ca00b268e5ba1a35678a1b5316d212f4f366b247724e663cd0da0927d5.
This dramatic change in the hash output despite a minor change in input is known as the “avalanche effect,” a property that makes hash functions extremely secure, reliable and suitable for blockchain technology.
Hashes are used in various Web3 applications beyond just cryptocurrencies:
Smart Contracts: Smart contracts often use hashes to verify the integrity of data or ensure that certain conditions have been met.
Digital Signatures: When sending transactions on a blockchain, digital signatures use hash functions to securely sign and verify the authenticity of messages.
Non-Fungible Tokens (NFTs): NFTs often include metadata that is hashed to ensure the data related to the token (like the digital artwork it represents) remains unchanged.
In the world of Web3, hashes are like the glue that holds everything together. They ensure data integrity, provide security, and allow for efficient data handling. Whether you’re dealing with cryptocurrencies, smart contracts, or NFTs, understanding hashes is crucial to grasping how the blockchain works.
Hopefully this quick explainer article has helped you advance your understanding of the tech behind the web3 world. Until next time!
Yield farming lets users get rewarded by staking digital assets on decentralized platforms. Learn how it works, why it’s important and what to watch out for in this introductory explainer blog.
Liquidity is a key concept in Web3, enabling smooth and efficient trading of crypto assets. Learn how liquidity pools and liquidity providers make decentralized platforms work.
Stablecoins have emerged as an important part of the web3 world, playing a crucial role in providing financial stability to a typically volatile cryptocurrency market. For those new to blockchain and crypto, stablecoins might seem like a complex concept, but they’re actually quite simple. Think of them as a “digital version of the dollar” or…
Learn about nodes, the essential building blocks of decentralized networks, and discover the unique role of Gala Founder’s Nodes in the Gala ecosystem.
Imagine that you were a scammer trying to target a particular group of people… let’s say people who like to spend their days at the lake relaxing with a fishing pole hanging in the water. Who knows why – maybe you are trying to sell counterfeit lures? Coordinate putting out some AI-enabled fishing rod that’s collecting fingerprint data while they laze their days away? Motivations are rather inconsequential for this example.
You could pay for a big list of dark web data, but you could also just insert yourself into that community. You can hop on message boards, join chat groups, heck you could even go hang around local bait shops. Before long, you’ve got a lot of useful demographic data on people that are part of that group. Maybe all you have is some emails and IP addresses… but that’s enough to start refining your list and getting more information.
The same is true with Discord. The Gala community is a great place for the latest news and robust conversation about every aspect of the Gala Ecosystem. The popularity and richness of social connections that are forged on our Discord server or Telegram channel, however, also make them a popular destination for another type – scammers. It’s important to know and understand the tactics of these digital miscreants to keep your digital assets safe while still participating in any digital community.
Welcome to the 8th installment of The Guardian Papers, where we try to impart the wisdom that everyone should have to start a successful journey through the world of digital ownership. The blockchain world is still in its infancy. We here at Gala believe that empowering each and any member of our community makes us stronger as a whole.
Miss an issue of the Guardian Papers!? Check out past editions below!
It is our hope that this series has and will continue to present foundational information that will not only provide a base understanding of how to keep your blockchain footprint secure, but will also help inform your journey through this digital adventure so you can ask better questions, do better research, and make better decisions to help guard your entire community.
The Dark Side of Community
Discord was originally made for gamers. As the scope of the platform has grown to include countless massively popular communities, however, it has also attracted the riffraff that stalks digital space for the opportunity to steal from the unwitting. Because Discord servers categorize people into common interests, it’s easy for scammers to get inside groups and represent themselves as just another member – or even an authority figure – within that community.
The same is true for Telegram or other messaging apps where people commonly gather in like-minded groups. In these spaces, the community itself has already done the work to compile victims for all the villains in the cryptoshadows. Communities are welcoming because that’s the point of community. By simply being in these groups, however, you’ve done part of the scammers research for them… they know that you are part of their target audience.
Make sure you customize your privacy settings in Telegram… or else you’re about to get a whole hornet’s nest of attention from all the wrong people!
Community messaging apps like Telegram and Discord are third-party platforms that are utilized by Gala, but these can have their own security issues that are simply beyond any community’s ability to control. The scammers thoroughly know the shortcomings of these apps, and can exploit them to attempt to scam thousands of members of a community within minutes. Even one success will show them this pond is well-stocked with easy catches for their future fishing endeavors.
Any community where the digital villains see opportunity isn’t going to get rid of them without a fight, however. We can only turn the tide against the scammers by making sure that each and every one of us is ready to defend against them.
Don’t forget to customize your exceptions as well! By default, any member of Telegram’s premium subscription can contact you regardless of your settings 😱
Don’t forget to customize your exceptions as well! By default, any member of Telegram’s premium subscription can contact you regardless of your settings! 😱
How Scammers Prey on Communities
It’s hard to build and feel community if you’re always suspicious of your neighbors. The scammers are counting on this, because that’s not how defenses work. When you perceive yourself as ‘among friends’ your defenses naturally go down. You want to be helpful – after all, that’s what building community is all about.
That’s why they’re here. Community is a group trust that we build up over time with likeminded people. We can’t simply turn it off and on. It’s not like we recognize every member of the community, we just recognize that they are part of the community.
We’ve discussed impersonation before, so you’re all very well aware that there are people out there who will pretend to be Gala customers or community support. You need to stay vigilant for these types of things… these apps are where the scammers find their marks.
This isn’t to say that community itself is bad. In fact, it’s very very good. Community standards and best practices are how we combat these scammers. Building a community is too important to let scammers stop us. We have to build a better community to make it outlast the villains.
Trust is Earned
Just because someone is part of your community does not mean they’ve earned trust, and it’s not an insult to tell them so. Caution is admirable… and part of the point of web3 is to establish systems that don’t rely on trust.
First off, please adjust your privacy settings on Telegram, WhatsApp, Discord or similar apps if you have not. In Telegram, for instance, you can be contacted by anyone by default. If you don’t change that it’s only a matter of time before you are getting blown up with spam and scams. Similarly WhatsApp will show your personal phone number to anyone who comes looking if you don’t change the security settings… make sure to get this done or you’re wide open to an attack from a crytpovillain.
Even on Discord you can customize your security settings to control who can reach out to you. As we’ve discussed before, don’t trust a display name… that can be easily changed. Put people you trust on your friends list. Consider changing your settings so friends can message you. That way any new friend requests are where you know you need to be vigilant, and anyone on your friends list has already been vetted.
Trust, but verify
-Old Russian proverb
Don’t trust these security measures to be the end all be all of your defenses, however! People can get hacked or lose access to their accounts. Sometimes the attack could come from someone you know… albeit not them actually sitting in front of their keyboard.
Community Strong
With so many threats among communities you trust, the fight against bad actors in digital spaces can seem hopeless. Fortunately, community is also the cure to this malady.
⬆️ Not a great way to seek help from the community. Not only does anyone watching now know this user’s needs, but also their urgency. I bet their DMs blew up.
⬅️This is a great way to utilize the knowledge of the community. Tons of eyes can get on the deceptive scam attempt right away to verify if it’s legitimate or not. HINT: This one was not legitimate.
No one person can be entirely vigilant all the time. We get tired. We get distracted. Our guard comes down for a moment here and there… and that’s when attacks happen. Talk to your community. Educate each other and call out the tactics that scammers are using so that everyone can learn to avoid them. Alone an attack is inevitable. Together we’re strong.
If you see something sus, reach out! Ask the community you trust whether you should be engaging. Don’t be embarrassed. A simple question could save you a lot of hassle.
Guarding Each Other
When we work together, the community really shows its strength. Those who seek to exploit communities of common interests in the web3 space are counting on us not following through with our commitment to a solid community. If a victim doesn’t use the community resources at their disposal to help themselves, what can a community do to help?
That’s why it’s so important to share tips and educate fellow community members about security culture. If we all get a little better at spotting bad actors, we’ll all be a little less likely to get scammed. If we all get a little better and share a little more of that culture with each other, we’ll be exponentially more protected from those who seek to do us harm.
That’ll do it for this week’s Guardian Papers, but we’ll be back! Next time, we’ll be breaking down multi-factor identification and how it can help protect your digital sovereignty in this new age.
Stay safe Galaxians… and always have your shield ready!
Recent studies show that over 90% of users are using mobile phones to access the internet. As phones have been streamlined for on-the-go media playback and mobile apps have been created to increase the convenience and accessibility of nearly every type of resource, “phone as computer” is a concept that is overtaking more traditional computation methods.
We still refer to these devices as smart “phones,” but it won’t be long before these devices have entirely left the limiting realm of anything that can be classified as a phone. In fact, the concept of telephone will soon be a relic of the past, with modern communication devices barely resembling the original apparatus patented by Alexander Graham Bell in 1876.
Several years ago, the earliest web3 pioneers liked to speculate about what mass adoption would look like. For fans of cryptocurrency, NFTs and decentralized ecosystems like Gala, mass adoption was one of the hottest phrases around, a constant topic of discussion.
Most of those early adopters considered that worldwide acceptance of web3 tech would involve some kind of overthrow of the web2 era, replacing the social-focused platforms the world had come to know with less centralized and more sustainable alternatives that allowed users greater control over their data. I wonder how many of them could have predicted that the rise of The Open Network (TON) would be so closely connected to one of the most widely used social messaging platforms in the world.
There’s no denying that The Open Network (TON) has taken huge strides toward mass adoption of web3 on multiple levels. Gala users have already seen multiple examples of it in the recent release of our first wave of mini app “tapper” games, Treasure Tapper and Music Miner, both playable now with a Telegram account. Rewards in these casual Telegram games will eventually amount to $TREZ, the tapper token of Gala Games, which will be issued on both TON and GalaChain and bridgeable from one to the other.
The combination of Telegram’s powerhouse widely used social messaging platform, TON’s speed and scalability as a blockchain, and Telegram’s mini app infrastructure makes it possible for an entirely new generation of highly accessible web3 tools to hit the scene. It would seem that Telegram finally cracked the code of comfortably onboarding web2 users to web3 technology, and every effective web3 community stands to benefit.
The Universal Basic Smartphone
The upcoming web3 smartphone (UBS) that has everyone talking was created by Oyster Labs (not directly affiliated with the TON Foundation). It can currently be preordered for $130 through their website, with estimated delivery in September of this year.
WEN PHONE, WEN PHONE!
We're one step closer to the final shipment! Building a Web3 phone isn't an easy task, and we are incredibly grateful to have the support of such a dedicated community like ours. Your enthusiasm and encouragement have been instrumental in getting us to this… https://t.co/42vmiTfREE
— Oyster Labs: Universal Basic Smartphone (@oysterecosystem) August 1, 2024
According to the front page of Oyster Labs’ UBS site, “Universal Basic Smartphone(UBS) is creating an equitable digital economy where everyone is fairly compensated for their data. In the era of AI, while we have little control over what happens to the data we produce, companies profit from it for free. UBS gives you the power to control and benefit from your data to build a future where everyone gets a share. UBS believes in a digital economy that gives back to those who participate.”
In addition to its Android 10 OS and other standard smartphone features that make it comparable to many phones on the market today, this unique “powered by blockchain” smartphone aims to bring a new level of web3 interaction to a massive new group of mobile users worldwide.
With the highly scalable TON blockchain’s ability to handle large volume transactions per second (TPS) and the potential for notable partnerships, this groundbreaking phone could become a cornerstone of the mass adoption we’ve all been waiting for.
Built-In Web3 with TON
Preordering a UBS involves connecting a non-custodial TON blockchain wallet, establishing the intrinsic web3 connection at the core of this device. Owners will have seamless access to hundreds of mobile dApps from the TON ecosystem in addition to the full range of mainstream Android apps.
Rewards from the Start
IN classic web3 fashion, Oyster Labs is offering a plethora of enticing reward opportunities even before the first UBS are delivered to pre-orderers.
$OYS Tokens – Oyster Labs is offering free $OYS* tokens as a benefit to pre-ordering the UBS. In the initial “Founding” series, 1000 $OYS was given for each pre-order. The presale is currently in its 2nd series, “Friend With Benefits” (FWB), gaining 300 $OYS for pre-order. Additional $OYS can also be picked up by referring others to pre-purchase the phone. *$OYS is currently tracked as a reward point system, not yet listed on any markets or minted on TON.
OysterEarn – Owners of the UBS will enjoy cashback benefits from both web2 and web3 companies
Genesis Pass – Preorder of the UBS comes with a special Genesis Pass and the opportunity to “claim daily data dividends and more.”
Learn More about UBS
This article is merely reporting and speculating on publicly available information, and does not indicate any sort of partnership or endorsement of The Open Network, Oyster Labs, Telegram or any other entity mentioned in this article.
We encourage our readers to do their own research in all aspects of web3.
