Blackmailing Bitcoin Scam Targets Porn Viewers, Cornell Professor Suggests It’s “Bluff”

Omar Faridi
  • A new crypto email scam attempting to extort $1,900 in bitcoin from porn viewers has surfaced.
  • Cornell professor Emin Gün Sirer shared the threatening email on social media

A new bitcoin scam has reportedly surfaced. In it, porn viewers are blackmailed by malicious actors who are attempting to extort $1,900 from the victims. The scammers are demanding to be paid only in Bitcoin (BTC). Through the use of malware, the scammers claim to have recorded footage of their targets watching porn.

The scammers begin to exploit their victims by first sending them an email that contains the users’ passwords or other private information. These passwords might have been obtained after company servers the victims use were hacked. They’re presented as “proof” that their computer has been compromised. At this point, whether or not the blackmailing videos even exist has not been confirmed.

Engaging in “CryptoBlackmail”

The scammers’ threatening e-mail further notes that a remote control desktop application has been installed on the porn watcher’s computer. This, the bad actors claim, allows them to remotely access the user’s computer and obtain video of them watching adult content.

Additionally, the scammers claim they have gained access to the user’s email contacts and that they will broadcast the compromising videos to everyone if they don’t get paid. They further offer “proof” by stating the footage will be sent to nine initial contacts if the user wants it.

To prevent this, the blackmailers demand $1,900 in BTC. Some analysts suggest this may all just be bluff. Cornell University’s computer science professor Emin Gün Sirer shared a copy of the emailhe said was forwarded to him by a friend.

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Sirer called the scamming tactic a type of “cryotoblackmail” and advised the recipients of these emails to not send money to the scammers or engage in any type of negotiation with them.

Sirer, a well-known cybersecurity expert who accurately predicted a serious vulnerability in the Ethereum-based DAO in 2016, claims that the blackmailing message was likely sent to those subscribed to the haveibeenpwned list, which is compiled of databases from various well-known breaches.

LedgerX Wins CFTC Approval to Offer Physically Settled Bitcoin Futures

Siamak Masnavi

New York City-based LedgerX LLC ("LedgerX") which is "a US-regulated trading platform for physically-settled digital currency derivatives", has had its application for designation as a contract market approved by the U.S. Commodity Futures Trading Commission, which means that it can now offer physically settled Bitcoin futures contracts.

LedgerX LLC, which is a wholly-owned subsidiary of Ledger Holdings, Inc., "has been registered with the CFTC as a swap execution facility and derivatives clearing organization (DCO) since July 2017." And now (actually, effective June 24, to be precise), it is "also registered as a designated contract market (DCM) under Section 5 of the Commodity Exchange Act (CEA) and Part 38 of the CFTC’s regulations." 

LedgerX had asked the CFTC to "amend its order of registration as a DCO," which limited LedgerX to clearing swaps, so that it could clear futures listed on its DCM.

The approval of this application, which was first filed in November 2018, means that the firm can now list Bitcoin derivatives contracts (including both options and futures) and offer them to both retail and institutional clients.

According to a blog post by LedgerX's CEO (Paul Chou), these new products will trade on a new platform called "LedgerX Omni":

"With our new license granted today, both retail and institutional customers can interact in the same transparent marketplace, LedgerX Omni, the first and only regulated US institution to offer these capabilities to the retail audience. We can now provide a robust market for a much broader audience, providing access to individuals who want to get exposure to the fast-growing crypto investment sector via derivatives products that they could not access in the past."

He also added:

"By operating both the exchange and clearing house, we can uniquely offer clients a vertically integrated trading and custody solution."

As for when people will be able to trade on LedgerX Omni, he had this to say:

"We have the license, but we also have a long waitlist. On-boarding will be performed slowly and require your patience, to allow us to thoroughly test and monitor the technology systems throughout the process, and to make sure that the customer experience is outstanding."

Also, apparently, the company plans to launch later this year "additional crypto-specific derivatives."

Juthica Chou, Co-Founder and Chief Operating Officer at LedgerX, told Coindesk that LedgerX was trying to be the first company in the U.S. to offer physically-settled Bitcoin futures:

“There’s no doubt that we’re looking to be first, we’re looking to be the incumbent. We think we’re better positioned and we want to be there to serve customers of all sizes.”

According to Bloomberg, the LedgerX CEO told them in a phone interview that LedgerX "plans to let consumers living in the U.S. or Singapore sign up to trade, starting in July," and that initially, "investors will have to deposit at least $10,000 in dollars or Bitcoins, but the minimum deposit will go down to zero within a year."

Chou said:

“The license will allow retail to directly invest, and they will represent the majority of the market. Retail investors are the ones that drove Bitcoin to this level.”

He also told Bloomberg that he believes that "other exchanges are about six months behind LedgerX in gaining regulators’ approval for expanded access to Bitcoin derivatives."

Meltem Demirors, the Chief Strategy Officer at CoinShares, was one of the first to congratulate the LedgerX team:

According to data from CryptoCompare, at press time, Bitcoin is trading at $11,346, up 3.02% in the past 24-hour period:

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Featured Image Credit: Photo via Pexels.com