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What Is a Dusting Attack?

Published on
June 22, 2022

What Is a Dusting Attack?

While blockchain technology is thought to be secure due to its cryptographic roots, the reality is that the industry is riddled with security flaws. The dusting attack, a type of aggressive red hat method used to deanonymize cryptocurrency wallets and their owners, is one unexplained but widely discussed security issue.

Both criminals and law enforcement agencies use dusting attacks for their motives. While one tries to unmask addresses for criminal purposes, the other seeks people who have misused digital assets. Although the strategy is effective when used by both parties, it is evident that fewer attacks are carried out as time passes. That isn't to encounter you won't be subjected to a typical dusting attack once or twice over your crypto career.

We will not only describe what dusting attacks are, how they operate, and how to prevent them in this article. Finally, you'll have the chance to see how severe (or insignificant) dusting attacks are.

What is a dusting attack, and how does it work?

By delivering tiny amounts of cryptocurrency to their wallets, a dusting attack deanonymizes and compromises the privacy of cryptocurrency users. The tokens are sent in such small quantities that they are barely discernible. Malicious actors frequently deliver the identical crypto already stored in a wallet. Otherwise, token transfers involving cryptocurrencies with low blockchain network fees are widespread.

Any amount specified as a satoshi (1 sat = 0.00000001 BTC) is dust in the Bitcoin world. You've been the victim of a dusting attack if you've received a few sats to a few hundred sats.

It's important to remember that not all dust results from a dusting attack. When trading or exchanging tokens, it is customary to practice leaving the smallest denomination of each token behind once the trade is completed. So, if you come across crypto dust from a recently traded token, it's more likely to be a trade byproduct than an attack.

Fortunately, most exchanges offer the option of converting dust. Dust conversion is the most straightforward approach to get rid of small balances because dust cannot be sold due to exchanges' minimum trading size requirements.

How a dusting attack works

We've already shown that dust is imperceptible and that it cannot be sold. Malicious actors take advantage of this by sending dust to several addresses to 'hunt' them down. The ultimate goal is to examine all addresses that have received dust and connect the dots by determining which ones are associated with the same wallet.

It is feasible to trace a person's identity this way. This is usually accomplished through unearthing minor facts about the target's identity or by blackmailing and extorting users using the original information.

Counteracting against a dusting attack

During a climactic encounter in the cult blockbuster WarGames, a computer AI handling nukes during the Cold War era advises its creator that the only winning move is not to play. Dusting attacks are similar in that the key attack vector is the act of spending dust and attaching it to another wallet held by the user.

As a result, the only winning strategy is to avoid using cash. This can be avoided by converting dust to crypto or flagging these assets and prohibiting your wallet from using them. Because the latter method is more complicated, conversion is the simplest way to go about it. There is no need to be concerned because most popular exchanges, including FTX, Binance, and Gemini, offer the feature.

Finally, how serious are dusting attacks?

As you can see, dusting attacks aren't as bad as they appear. The method entails sending modest amounts of cryptocurrency to several exchanges to keep track of transactions and determine which addresses are linked.

There's no need to be concerned if you are the victim of a dusting attack and fail to convert it. Because dusting attacks are essentially social engineering, they aren't fascinating. Rather than being the victim of a technological exploit in which your assets are directly stolen, you are the victim of your reaction to dusting attacks. You cannot be affected as long as you know what is going on.

Has someone used dust to connect all of your transactions and found your real identity due to a data leak? Is the same individual blackmailing you by sending you a message that includes your name, hinting that he is capable of considerably more malicious behavior?

Don't be concerned! There are far more significant security concerns out there (such as cryptojacking, ransomware, and so on), and someone knowing your name on the internet is the most insignificant of them all! You're good to go as long as you don't believe the other person possesses authority.