Dogecoin scammers pocketed millions by exploiting Elon Musk's 'SNL' appearance through giveaway schemes on YouTube, a report says | Currency News | Financial and Business News

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  • Con artists netted dogecoin worth $5 million through fake giveaways while Elon Musk hosted "SNL," a report says.
  • Victims were tricked into believing they would receive twice the dogecoin they sent, it said.
  • The report said many of the misleading YouTube videos had been taken down by Sunday.
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Dogecoin investors eagerly awaited Elon Musk's "Saturday Night Live" appearance, expecting his remarks to send the meme coin to new highs.

Quite the opposite happened. Not only did the cryptocurrency tank by 30% over the weekend, but the dogecoin community was led on by con artists attempting to trick them out of their holdings, a new report says.

The report, published by the blockchain intelligence provider TRM Labs on Monday, detailed how fraudsters manipulated Musk's promotion of the digital currency and pocketed dogecoin worth $5 million.

Here's how the scam worked, according to the report

During the "SNL" telecast, viewers who searched for "Elon Musk SNL" on YouTube could see livestreams that seemed to be hosted by the NBC show but were actually run by scammers, the report said.

The livestreams publicized links to unique websites that viewers could visit to receive dogecoin.

A message on the broadcasts said: "Elon Musk has devoted 500,000,000 DOGE to be distributed to all DOGE holders. Anybody can get some, just visit the website."

This was perhaps somewhat believable, as many of Musk's followers expected the billionaire's "SNL" appearance to pump the digital asset.

TRM Labs

Users were asked to transfer dogecoin to a blockchain address with the assurance that they would receive double the amount they sent.

TRM Labs

The report said that as of Sunday, the scammer addresses had received about 9.7 million dogecoin worth $5 million. It described initial findings that most inflows had been sent to the wallets by the owners themselves to create the illusion that they were legitimate accounts.

Many of these videos had been taken down by Sunday, the report said.

One person said in a post on the dogecoin subreddit on Saturday: "Don't fall for it like I did. The website won't send you back twice the amount of coins you send them. I just went from having savings for this first time in my life to 60 bucks left in my pocket."

"Giveaway scams are not new," TRM Labs' report said. It quoted an FBI website about mass-marketing fraud schemes as saying they "victimize millions of Americans each year and generate losses in the hundreds of millions of dollars."

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Dogecoin rebounds after Musk hints Tesla could accept it as payment

The digital asset recouped some losses on Tuesday by climbing by as much as 20%, to $0.55. Musk tweeted a poll asking his followers whether they wanted his electric-vehicle maker to accept dogecoin as payment.

By Tuesday morning, most respondents had said yes, while about 20% had said they didn't think it was a good idea.

"As much of the value in Doge is speculative or perception driven, Elon seems to have anointed Doge as the de facto cryptocurrency with what seems to be a half-humorous, half-financial decision," said Edozié Izegbu, the founder and managing director of digital art for the crypto platform Chimera. "The real question to be wary of is how long can this joke last."

The meme-inspired cryptocurrency is up more than 11,000% so far this year, while bitcoin is up 90%.

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