After doing a few minor OTC deals, I became interested in mediating in big OTC trades.
It sounds like a dream: a buyer wants to buy 100k BTC, a seller want to sell 100k BTC, usually below market rate. When the transaction is done you make 0.2%, meaning 200 BTC, which is a lot of money. So why not try?
Spending time in the space I have learned about a whole range of tricks and scams including sending a Satoshi, faking proof of funds, faking entire companies etc... In this article, I want to focus on one particular scam, the fake POC, to be more accurate creating fake videos using the Blockchain wallet.
So what is really happening here?
Buyers of a big amount of BTC want to make sure that the "seller" has the amount of bitcoin they are willing to buy... but, how can they verify it?
The best way for buyers is to get a Satoshi or a signed message ... but sometimes, the sellers are not willing to do it.
This particular problem will be explained in my next article, but for now, let's look at some other options:
- Zoom call and live POC.
- Physically meet for the POC.
- A video which will prove that the seller has the coins
I remember the first time me and my partners saw a video of someone logging in to their Blockchain wallet and show us the many coins they had... I was thinking, we can easily close this deal since the seller obviously has the coins ... but I was wondering why would the seller use an unsecured wallet like Blockchain.
My willingness to be part of a big deal took over my rational thinking, and as a result, we burnt ourselves in front of some smart buyers.
The buyers will ask for the POC video including a tag of some kind, in order to make sure that the seller is not using a previously made video. This could be a code word, the name of the buyer etc...
in order to be sure that the seller is not using a recycle video.
What we found out is using the Blockchain wallet for POC proved nothing.
Why is that?
In Blockchain wallet you can easily add the 'watch only addresses' option, so what you can basically do is
- go to the addresses option
- add a public address from the list of the richest 100 bitcoin addresses https://bitinfocharts.com/top-100-richest-bitcoin-addresses.html
- log out
Now, when you log in to your Blockchain wallet the balance of the ‘watch only addresses’ will appear and you can display it as if it were your own. Furthermore, if the seller is really following his own public addresses using the Blockchain wallet the video will still prove nothing.
So next time you get POC with login from a Blockchain wallet please tell the sender to go fuck himself and save yourself some time for more important things.