Crypto scammers rip off Billions as Pump-and-Dump schemes go digital. Billions are getting pilfered annually through a variety of cryptocurrency scams.
The way things are going, this will only get worse. Nowadays, there are many instant crypto exchange solutions, which typically aggregate prices and liquidity from multiple custodial trading exchanges, offer a light registration process with a simple exchange UX.
Even for crypto veterans, the role and functionality of instant crypto exchanges may be unfamiliar. You won’t see the likes of Changelly, Shapeshift and ChangeNOW on CoinMarketCap’s top exchange list.
Nowadays, a lot of people are more open to share their experiences regarding to online instant crypto exchange. Not all of the shared stories are with a happy endings. There are many of them which are reported as a scam from the official cryptocurrency exchange sites.
Changelly KYC Scam: They are holding my $19800 BTC hostage
Changelly is a non-custodial cryptocurrency exchange that offers almost 200 different cryptocurrencies. Its easy-to-use service is secure and lets you trade cryptocurrencies at low fees.
There are many customers who are exchanging cryptocurrencies daily through Changelly, but not all of them have a positive experience.
One guy from India is sharing his real experience with Changelly, which claims that he was scammed.
The only reason that he trusted them is that they are listed as a trusted partner of Ledger and Exodus. This is the summary about what happened.
The guy tried to exchange 0.4349346 BTC ($19800) to 19740.61 DAI (ERC20) on April 4th. Exchange ID – q3pavhd2w7t6x591
Changelly deposit address is shown on the image.
The deposit was 6 days ago. After it was processed he noticed that his exchange is put on “hold” and there was an alert telling him to complete KYC verification (KYC – Know Your Customer). Then he completed the KYC verification as soon as he could. Changelly uses a 3rd party KYC authentication service called Sumsub.
After he did a successful verification through Sumsub, his exchange was still on hold. After a couple of minutes, another alert appeared asking him to contact [email protected].
He got a hold asking him to fill in KYC details. He completed that and the verification was successful. However, the transaction still says that it’s on hold.
The first message that he sent to them is “How long will it take?”
After few minutes they replied to him with this message.
They are still asking the guy to provide the information about the origin of his funds and that he owns the bitcoin.
After that, he sent them images from his “wallet” and replied to them.
On this, Changelly replied to him “Could you please specify how you obtained the BTC in question? Were they purchased, traded, or mined – for instance?”.
After this reply from Changelly, the guy replied to them that he met up with his friend in real life and bought BTC from him using cash. He usually buys BTC from his friend since his cards are not compatible with bitcoin purchase sites.
In continuation, they sent him a long list of bitcoin addresses and told him to confirm which ones are his own. The guy confirmed that only a few of them were his addresses and showed them a screenshot of his addresses inside the electrum wallet.
After proving those addresses are his own, Changelly replied back to him, asking to tell his friend who sold him the BTC to contact them in order to pass the KYC procedure.
At this point, the guy got a feeling that he may be scammed by Changelly, because his friend was not a customer of Changelly and there was no need for him to complete KYC (Know Your Customer).
He got scared that his friend may not agree to trust an exchange with his personal information and documents. Anyway, he tried to persuade him to do the KYC checks and his friend also reached out to Changelly and completed KYC checks within an hour.
After the successful KYC verification of his friend, they replied to him and demanded proof of ownership of the bitcoin he sent to the guy originally. This is the point where he started to get doubts about their legitimacy at this point. He suspected that they were trying to trap them into a KYC loop.
They moved forward and disclosed to Changelly that the source of funds was paxful.com.
Check the image below.
In continuation, Changelly asked him if the sender wallet addresses (from paxful to his electrum wallet) belong to him or not. The friend of the guy answered them that the addresses technically belong to Paxful because it is an exchange, not a Decentralised wallet.
In the same mail, he told them that they are supposed to do KYC checks on him before the exchange initiation on Changelly.
After hours of no replies, Changelly replied to him asking for screenshots of transactions from Paxful to his electrum wallet. On this, he sent them 3 screenshots which were of the 3 largest transactions to his 3 wallet addresses.
After a hard effort, Changelly verified the source of funds and sent him a response saying that the case is being reviewed and they will contact him back as soon as possible.
Since there were no updates even after 1 day, his friend emailed them again to ask for updates. Changelly replied, “Please be informed that once there are any updates, we will immediately let you know.”
After 2 days of no reply from Changelly, they have been emailing them multiple times. His friend tried to request them to return the bitcoin to the original sender if they cannot carry out the exchange. But they never got a reply from Changelly to any of it.
Finally, on April 6th, Changelly replied saying that a review of the case could take months.
Why would it take months if they already verified KYC and proved a source of funds???
Check the reply on the image below.
This was the last reply they got from Changelly, and from April 7th to April 10th, they kept mailing asking and asking for any updates. At this point, Changelly never replied back to them.
This was enough to convince the guy that they have scammed. He didn’t give up and continued to look for similar stories by just googling for “changelly KYC”.
After all the exchanges between Changelly and the guy from India, he finally made a conclusion that he was indeed scammed and is desperate for any help to retrieve what was lost.
At this point, there can’t be any judgment for real who is doing right and who is doing wrong in this scenario.
Either Changelly is really trying to scam the guy, or the guy is trying to do some illegal exchange with an invalid cryptocurrency exchange or even his friend may have sold him an invalid cryptocurrency, so no one can know for real.
Nowadays, it’s hard to trust anyone. It doesn’t matter if it’s someone you personally know or from a legitimate site.
Time and time again, it’s proven that being cautious in dealing with online transactions like this especially anything of value, may it be monetary or property. It’s our obligation to double-check everything to avoid being swindled.