What is a Testnet and Why Scammers Love It?

If you are not a blockchain developer or do not routinely dive into the code, chances are, you won’t even know what a testnet is when using cryptocurrencies. There is one very unfortunate circumstance in which you might learn about it in a completely unintended way — falling for a testnet scam. In this article, we’ll cover why testnets do not deserve a bad rep for this and how to avoid these schemes.

So, what does testnet mean in crypto?

Coming from “test” and “net” as in “network”, testnet means a version of a blockchain that is primarily used for testing purposes. Its opposite is mainnet, which you know and love as the real actual blockchain networks.

The distinction between the two is solidified in the fact that the native tokens used in a testnet have no monetary value. Testnet tokens are not freely tradeable and do not need to follow the supply dynamics or tokenomics of the mainnet cryptocurrency. With them, developers are free to test their blockchain applications and contracts without risking real funds, while getting a good idea of how real tokens would work in those.

The Main Testnet vs. Mainnet Distinction

By design, testnet and mainnet transaction histories are completely separate and non-transferable. Therefore, it does not matter how much testnet Ether you get with a faucet, you cannot convert it to mainnet ETH.

• Mainnet: The live, fully functional blockchain with tokens having real monetary value. All transactions are permanent and can bear real consequences.
• Testnet: A separate, simulated environment for testing. Although its purpose is to simulate mainnet behavior, the rules are a lot more loose: faucets are way more generous, for instance.

Testnets are quite cool, often giving users the opportunity to see things yet to come to the mainnet. But for some unlucky users, their first encounter with the idea might be falling for a trap.

How Testnets Get Used in Scams

So far, we have established that a regular cryptocurrency user has no need to even know about testnets, leave alone use them. Scammers exploit this lack of knowledge to convince victims of things that are not really there: balances, airdrops, even whole projects. However, their returns from the act can be rather tangible: actual money, personal data and access to wallets.

Forewarned is forearmed, so for our further tips to not sound hollow, let’s first see how scammers take advantage of testnets to defraud users.

Faking Receipts

Scammers often promise a large airdrop of a new project’s tokens, claiming they’re valuable, but they are actually worthless testnet tokens. They may create a fake website, social media profile, or even a fake token on a decentralized exchange (DEX) to make it seem real.

• How it works: A scammer advertises a new, exciting project and a large token airdrop. To claim the “airdrop,” you’re instructed to connect your wallet to a fake website or send a small amount of real cryptocurrency as a “gas fee” or “verification” fee.
• The catch: By connecting your wallet to their malicious site, you may expose your private keys or unknowingly sign a transaction that gives them permission to drain your wallet of its real funds. If you send them a fee, your money is gone for good.

Fake Projects

Some scammers create a completely fake testnet and lure users in with promises of future profits. They might try to sell you a “membership” or “early access pass” for real money.

• How it works: The scammer creates a fake testnet and promotes it as an exclusive, high-potential project. They’ll tell you that you need to send them a small amount of real cryptocurrency to get whitelisted for the project or to get access to the “real” tokens.
• The catch: There is no real project, and the money you send is a donation to the scammer.

(Testnet) Token Sale

In this scam, a fraudster tries to sell you testnet tokens, claiming they’re the real mainnet tokens at a discounted price.

• How it works: A scammer posts a “too good to be true” offer on a social media platform, claiming to be selling a valuable cryptocurrency for cheap. When you agree to the trade, they send you worthless testnet tokens while you send them real cryptocurrency.
• The catch: You’re left with useless tokens, and your real money is gone. Remember, testnet tokens’ whole thing is that they have no value, so they should never be purchased.

Recognize and Avoid Testnet Scams

Since bad actors want to take advantage of you not knowing what a testnet is, your countermeasure is to not give them this chance. You’re already halfway there! Here are a few more tips to stay safe and blow the lid off their testnet-related schemes.

1. Verify the Source

Always double-check the project’s official channels. If you hear about a testnet or airdrop from a random person or an unrelated social media account, it’s a major red flag. Check for official announcements on the project’s website, blog, and verified social media profiles. Cross-referencing might also be a good idea.

2. Never Pay for Testnet Tokens

Testnet tokens are free. The purpose of a testnet faucet is to give away testnet tokens for free so that developers and users can test the network. If someone asks you to send them money to receive testnet tokens (check the explorer to know for sure), it is a scam.

3. Check Wallet Addresses

Some testnet addresses have a different format than their mainnet counterparts. For example, Bitcoin testnet addresses begin with ‘m’ or ’n’, while mainnet addresses start with ‘1’, ‘3’, or ‘bc1’. While not all testnets have a distinct address format (like Ethereum), it’s a good practice to be mindful of this difference. Besides, checking an unfamiliar address even if it does not set off immediate alarms might expose it well before anything happens.

4. Haste Makes Waste

All kinds of scammers often create a sense of urgency, pressuring you to act fast before an opportunity is gone. In reality, the only thing you are missing out on is the chance to realize you’re being duped. Scammers trying to convince you their testnet addresses and tokens are real would want nothing more than you not seeing the “testnet” label in the wallet or blockchain explorer — don’t give them this chance.

5. Use a Separate Wallet for Testing

For maximum security, use a dedicated crypto wallet for all your testnet activities. This wallet should not hold any of your real, mainnet cryptocurrency. This practice ensures that even if you accidentally interact with a malicious contract (a more common beast in this forest), your real funds remain safe.

Conclusion

Without testnets, blockchain development would probably have been in its Stone Age still, so when used for intended purposes, they are awesome. They’ll even let you live out that dream of having 1, 10 or 10,000 bitcoins — just remember that those are fool’s gold, and don’t let the scammers scam you!

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