Bee Token ICO Stung by $1 Million Phishing Scam

Investors in the decentralized home sharing network Bee Token’s initial coin offering (ICO) have been swindled of nearly $1 million in just over 25 hours.

Bee Token, which recently partnered with San Francisco-based financial services platform WeTrust to create a decentralized competitor to home-sharing service AirBnB, launched its public ICO on Jan. 31.

However, while the startup runs its token sale, scammers posing as operators appeared to have launched their own version. Using email addresses like [email protected], the scammers contacted would-be buyers who then signed up for the full token sale.

All told, signs indicated that those involved collected at least $928,000 from potential investors.

It is not immediately clear how the scammers acquired investors' emails, though one Reddit user claims the startup failed to secure their email database. The scheme involved emailing victims an ethereum address or a QR code which lead to the address, telling them to invest quickly to significantly increase their returns, according to one user who shared the email they received.

Three ethereum addresses, two of which are confirmed to be part of the Bee Token scam and one of which has only been confirmed to be related to phishing schemes in general, show balances ranging from $100,000 to nearly $600,000. The earliest transaction for any of the three addresses happened on Jan. 31, at roughly the same time the token sale began.

In a statement released late last week, the company confirmed the existence of the scams, saying investors should only send funds to an address listed on the startup’s official website.

Notably, the company went on to state that even email addresses ending in @thebeetoken.com would be impersonators:

“Further, we will NEVER communicate ANY funding address via any channel other than on beetoken.com. If you are solicited to send money to an address (even if it’s from a thebeetoken.com email address, official Bee Token social media accounts, or Bee Token telegram moderator/group), please report this to a moderator on Telegram (@DTodd) and email [email protected].”

In another statement, the company stated it would not use QR codes, give 100% bonuses, accept more than 0.3 ETH or partner with Microsoft.

The startup completed a successful private pre-sale in late December, as well as a public pre-sale earlier this year. So far the company has raised roughly $10 million.

A spokesperson for Bee Token did not immediately respond to a request for comment.

Bees image via Shutterstock