Sybil Attack: How Crypto Networks Get Manipulated and How to Spot It

When a Sybil attack, a type of security breach where one entity creates many fake identities to gain disproportionate control over a network. Also known as identity flooding, it's one of the oldest threats to decentralized systems. Think of it like one person pretending to be a hundred people in a town meeting—except in crypto, those fake identities can sway votes, drain liquidity, or manipulate token prices. This isn’t theoretical. It’s happened on small DeFi protocols, low-liquidity DEXs, and even airdrop systems where rewards are distributed based on wallet count.

Most blockchains rely on consensus mechanisms, the rules that let nodes agree on the state of the network like Proof of Work or Proof of Stake. But if the system doesn’t properly verify who’s real and who’s fake, a Sybil attacker can flood it with wallets, each claiming to be a separate voter or staker. In airdrops, that means one person claiming 500 rewards. In governance, it means one actor controlling 70% of the votes. Projects like Unifarm, a DeFi platform that rewards users based on participation and others that rely on wallet-based incentives are especially vulnerable. That’s why the AST Unifarm airdrop page warns you: no official drop exists. Scammers often use fake airdrops to collect wallets—exactly the kind of setup a Sybil attacker exploits.

Real networks fight back with proof-of-humanity, methods like facial recognition, phone verification, or social graph analysis to confirm real people. But many small projects skip this to save cost or time. That’s why you see dead platforms like CoinCasso or SoupSwap—no real users, just bots. Hotbit and WBF Exchange? Their low volume and fake trading? Classic signs of Sybil-driven wash trading. Even in NFTs, airdrops like Lepasa Polqueen or SHF CMC X SHIBAFRIEND can be gamed if the system doesn’t check for duplicate wallets. The same goes for GameFi tokens like LRDS or FARA—any reward tied to wallet count without identity checks is a target.

If you’re trading, staking, or chasing airdrops, ask this: does this project verify real users? Or are they just counting wallets like a spreadsheet? If the answer is the latter, you’re not investing in tech—you’re betting on a rigged game. The posts below show you exactly where this happens, how to spot it, and which platforms actually take security seriously—so you don’t get caught in the noise.