The smallest unit of Bitcoin is 1 satoshi (0.00000001 BTC). There is no strict definition for how many satoshis the term dust refers to, but it is generally used to mean an amount less than the transaction fees required to spend it – likely a couple of hundreds of satoshis. It’s such a tiny amount that most people wouldn’t even notice it in their wallet.
Hackers and scammers will send these very tiny amounts of cryptocurrency to a large number of users’ personal cryptocurrency wallets. Bitcoin is not anonymous, as many believe, rather it is only pseudo-anonymous.This means that hackers can then track these funds and all the transactions made by the ‘’dusted’’ wallets to perform a combined analysis of several addresses, enabling them to link the addresses and eventually determine the identity of the person or company behind an existing wallet.
If successful, the attackers may use this knowledge against their targets, either through elaborated phishing attacks or cyber-extortion threats.