Crypto Scammers Use Anti-Muslim Rage-Bait to Push Fake XRP and XLM Schemes

• CSOH identified more than 220 X accounts suspected of financial or sexual bait scams.
• Scammers use anti-Muslim posts and political outrage to build audiences before promoting investments.
• Scammers allegedly direct victims to invest in XRP and XLM through fraudulent financial claims.

Anti-Muslim posts on X are being used to attract attention and build audiences before scammers introduce fraudulent investment opportunities. A report by the Center for the Study of Organized Hate (CSOH), identified more than 220 accounts suspected of financial or sexual bait scams. Some accounts later warned followers of an alleged banking collapse or financial reset before steering them toward cryptocurrency schemes involving XRP and XLM.

Anti-Muslim Rage-Bait Creates Trust Before Investment Pitch

The campaign reportedly began in September, as the US midterm election season gained momentum. Some accounts used AI-generated images and inflammatory anti-Muslim messages to provoke reactions, attracting thousands of comments and tens of thousands of views on certain posts.

Researchers found that several accounts used names that referenced President Donald Trump, members of his family, and Vice President JD Vance. However, they found no evidence linking these accounts to the individuals they referenced. Some posed as government officials or news outlets, and some as political labels tied to the MAGA or QAnon movements.

Rather than promoting investments immediately, the accounts first built audiences through political content. They later approached users with warnings about an alleged banking crisis, stock market collapse, or imminent financial reset. This shift from political outrage to financial fear created an opening for fraudulent investment pitches. 

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Fake Trump Accounts Direct Users Toward XRP and XLM Schemes

The account known as “Trump Account” was originally pro-Trump and anti-Muslim, but later promoted the so-called Quantum Financial System, a theory surrounding financial conspiracy. After contacting the account on the messaging app Telegram, CSOH founder Raqib Naik received a bank-collapse warning from the account holder and assurances of a close relationship with the Trump administration.

Then the account said that all other currencies would cease to exist and asked Naik to transfer his money to XRP and XLM. It also directed him to a website where he could open a new bank account. Scientists were able to record similar incidents with accounts pretending to be part of the Trump family.

The account’s claims about a banking collapse and the disappearance of other currencies were part of the alleged scam’s pressure tactics, not evidence of an actual financial crisis. The CSOH report did not quantify the financial losses or identify the individuals operating the accounts. Telegram, meanwhile, said it would investigate reported fraudulent accounts and remove those flagged by moderators or users. 

How Investors Can Recognize and Avoid the Scam

The biggest warning sign is when scammers use private messages to push fear-driven financial claims disguised as political information. News of banks closing, currencies collapsing, or a hidden financial system for certain investors should call for independent verification. Other red flags include unsolicited Telegram contacts, unfamiliar account-registration links, and promises of access to special privileges.

XRP and XLM are legitimate crypto assets associated with the XRP Ledger and Stellar network. Their use in the scam does not make either cryptocurrency fraudulent. Instead, the alleged deception involves false financial claims, impersonation, and potentially fraudulent websites designed to trick users into transferring their money.

The US Federal Trade Commission recommends that consumers research investment opportunities, avoid pressure to rush in, and treat guaranteed returns as a red flag. Investors should confirm information from official sources, never send money to strangers, and notify suspicious accounts on the platform. 

Those who have already transferred cryptocurrency should contact the exchange they transferred from, keep records of the transactions, and report the crime to authorities. They should also avoid recovery services that require payment in advance.

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