Crypto scams are making headlines almost daily. Although cryptocurrencies are among the most exciting innovations in the 21st century, like all technology, some hazards accompany them. It may be liberating to be free from having to hold physical currency or constantly making credit card or bank transactions.
However, the ease, convenience, and anonymity provided by cryptocurrencies and the blockchain can create a hiding place for cybercriminals who want to rob people through crypto scams. There are many tips for staying safe online and avoiding these crypto scams.
CryptoComplaint experts provide consumers with information about financial services and can assist people who have been affected by crypto scams, forex trading scams, and other forms of financial fraud. Our team has the resources to assist with crypto complaints and can provide guidance to consumers and get them started on the fund recovery process.
How Common Are Crypto Scams?
People who keep up with news on cybercrime can attest that crypto scams dominating the news about financial fraud. Although plenty of people still fall prey to forex trading scams, CFD scams, and binary options frauds, millions are being lost a day to all types of cryptocurrency scams.
One reason is that bitcoin and ethereum are types of currency, and they can be involved in many aspects of fraud. For instance, thieves can steal bitcoin directly or sell a fake crypto app filled with malware. People can get cheated trading cryptocurrencies or a merchant or broker could demand payment in cryptocurrencies only to run away with the money.
The rise of crypto scams has been overwhelming. The number of crypto scams, as of May 2021 has risen 1,000% since October 2020, according to CBS news. Part of this is due to the popularity of digital coins and their volatility. Any trend tends to attract fake versions and those who want to profit off of it dishonestly.
So if you want to explore the freedom and convenience provided by cryptocurrencies, how can you stay safe from crypto scams? The first step is to understand the various types and crypto scams and getting a clear idea of how they work.
Types of Crypto Scams
There are many types of crypto scams. Here are the most common varieties:
- Fake crypto trading
- Fake bitcoin wallets
- Phony ICOs
- Social Media Impostor Crypto Scams
- Bitcoin Phishing
Cryptocurrencies are popular in trading circles. Because they are so volatile, they attract traders who are hungry for risk and want to see if they can game the highs and lows of digital currencies. However, there are many crypto trading scams. These are characterized by offering cryptocurrencies as investments or the brokers accepting only bitcoin as payment.
There are unfortunately many bitcoin wallets and apps that are either simply fake or contain malware that infects devices. When new digital coins make their premiere, be careful that they aren’t phony ICOs. Scammers attract investors to fake digital coins and end up pocketing the money.
Among the most common types of scams are social media crypto scams. This was demonstrated by the Twitter scam masterminded by a 17-year-old who pretending to be Barack Obama, Bill Gates and other celebrities. These famous people supposedly were encouraging trading, when the teenager who was behind the false identities took the money and tried to disappear with it.
How to Avoid Crypto Scams:
- Trade only through a regulated broker
- Make sure you buy cryptocurrencies and products such as wallets and apps from verified platforms and sites
- Send money only through secure websites
- Do not give anyone your cryptocurrency codes
- Avoid clicking on any links or downloading from people you do not know
- Be skeptical of extravagant promises
Like any type of trading, cryptocurrency trading should only be done through a regulated broker. With a regulator overseeing the broker, it is easier to file a complaint and deal with problems. All apps, wallets, and cryptocurrencies should be purchased by a verified seller. Do not click on links sent through social media or from people you don’t know.
Although cryptocurrencies operate on the blockchain which is free from government regulation, dealing with others who feel unfettered can risk your security. Making sure websites are secured, brokers are regulated and platforms have oversight are essential for staying safe from crypto scams.
Naturally, people are excited about cryptocurrencies. However, this excitement should not be so intoxicating that it can cause people to believe extravagant promises about cryptocurrency returns. Be realistic and aware of how volatile digital currencies are.
For example, from the end of 2020 until the spring of 2021, the value of bitcoin went from 10,000 to nearly 60,000 before dropping on news that Elon Musk would not accept bitcoin to pay for Tesla cars. This demonstrates that, with a volatile asset, just one news story out of the blue can erase any returns from trading.
What to Do If You Have Lost Money to a Crypto Scam?
There is unfortunately a common idea that once cryptocurrency transactions have taken place on the blockchain, the money can’t be retrieved. This isn’t true. Law enforcement is exploring new ways to investigate crypto transactions and uncovering the identities of scammers on the blockchain.
Another way to assist law enforcement to track down scammers is to through a crypto complaint. Consult with Crypto Complaint experts who will refer you to experts who can investigate the scam and draw up a crypto complaint.
It is important to act fast. Cybercriminals have the technology to mask their identities and launder money on the blockchain. Although fund recovery experts can track down scammers, your chances of successful fund retrieval are increased by filing a complaint right away.
Have You Experienced a Crypto Complaint? Talk to CryptoComplaint Experts
Consult with CryptoComplaint experts immediately if you have lost money to a crypto scam, a CFD scam or another type of fraud. Our team can provide solutions and advice on how to seek restitution and recover from fraud.