Zero-Value Transfer Scam | A Crypto Scam That Doesn’t Need Private Keys

A zero-value transfer scam is a sophisticated crypto phishing technique that exploits user confusion without requiring access to private keys. It works by scammers creating a fake ("vanity") wallet address that closely resembles an address the victim has previously interacted with, matching the first and last few characters but differing in the middle.

The attacker then initiates a zero-value token transfer from the victim’s wallet to this spoofed address using the "transferFrom" function in Ethereum smart contracts, which does not require approval for zero-value transactions. This transaction appears in the victim’s wallet history, making the fake address look familiar and legitimate.

When the victim later tries to send tokens to what they believe is a trusted address by copying it from their transaction history, they accidentally send funds to the scammer’s spoofed address, resulting in irreversible loss.

This scam leverages the fact that crypto addresses are long and complex, causing users to focus only on the beginning and end characters, and it manipulates transaction history to deceive even cautious users. The attack is a form of "address poisoning," where the victim’s transaction history is polluted with misleading entries.

To mitigate this risk, users are advised to always verify the full wallet address before sending funds and consider using blockchain naming services like Ethereum Name System (ENS) that provide human-readable addresses.

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