If you’re like most of us sitting at home reading the news over the past year or so, you’ve surely noticed at least a few headlines regarding up-and-coming cryptocurrencies, particularly Dogecoin, Bitcoin, and Ethereum.
Unfortunately, as new investment options become more popular, so do new types of investment scams.
According to the Federal Trade Commission (FTC), Crypto scams account for more than $80 million dollars in losses since October 2020 — and that’s just in the US.
The majority of crypto scam victims, or 44% of those targeted by crypto scams, fall within the 20 to 39 age range. The median loss reported by those who were scammed is $1,900.
Though still considered a highly unstable form of currency by investors, cryptocurrencies are becoming increasingly normalized as celebrities back them and large corporations even start to accept them as forms of payments.
As the prevalence of crypto grows, scammers have been coming up with different ways to rob investors of their cryptocurrencies.
In one scam, the fraudsters pose as celebrities and dupe investors into sending them cryptocurrencies with a promise that they will get their currencies back with a return on their investment. Of course, the victims never see their money again.
The top celebrities crypto scammers have posed as over the past year are Elon Musk, John McAfee, and Yusaku Maezawa.
Another technique scammers are using is to post fake investment tips online (on scam sites, social media, or investment tip forums) that direct unsuspecting investors to fraudulent sites that promise a big return on investment (ROI) if they deposit funds.
A third tactic fraudsters employ is to pose as someone from a government agency like the social security administration and request a payment in the form of Bitcoin or another popular cryptocurrency.
Crypto scammers will even play with your heart to trick you out of your cryptocurrencies. The FTC reported that 20% of the funds lost to crypto scams since October 2020 was lost through online romance scams.
Tips to avoid crypto scams in 2021:
- Be wary of investment tips you come across online
- Don’t fall for anyone pretending to be a celebrity
- Remember that a government entity will never ask for crypto payments
- Watch out for investment return promises that sound too good to be true
- Don’t pay anyone who will only receive cryptocurrencies
- Never send cryptocurrency to someone you met online (especially through dating sites or apps)
Why are crypto scams growing in 2021?
People newly reaching investment age in their 20s and 30s are increasingly looking for new, “hot” investments, and cryptocurrencies fit the bill. This opens up a whole new world of opportunities for scammers to take advantage of them.
Whereas traditional investments are harder to get scammed on (people 50 and older are less likely to fall victim to crypto scams), the world of crypto is still unregulated and highly volatile. You can think of it kind of like the “Wild West” of investing.
Because of the lack of regulation and constantly changing landscape, there is also a fair amount of “FOMO,” or “fear of missing out,” for crypto investors. One day a cryptocurrency like Bitcoin might shoot up $30,000 in value, and the next it can come crashing down again.
This FOMO creates a lot of pressure to buy or sell certain cryptocurrencies in the heat of the moment, without thinking too much about the decision. Because of this, it’s easy for scammers to create a sense of urgency and trick investors out of their money.
Fraudsters can set up cryptocurrency investing sites that look legitimate, load them up with crypto jargon, and require users to create an account into which they deposit their cryptocurrencies in hopes of earning a big ROI.
Since crypto investing is so new, it’s important to be very careful about where you store and transfer your funds.
Is there hope for those who were scammed?
If you or someone you know has fallen victim to a crypto scam, there is some hope. Know that you’re not alone and that there are people out there on your side in this fight.
PayBack LTD specializes in trading and investment scam funds recovery and we have a strong track record of getting your money back.
We’ve successfully retrieved money from major fraudulent and insecure crypto platforms including Gladiacoin, Coinbase, Bitconnect, USI Tech, Cryptsy, and more.
Our team is composed of former options and forex industry professionals, international bankers, and cybercrime specialists. We’ll put pressure on scammers where it hurts most — their processing and banking funnels — and go to great lengths to retrieve your funds.
Contact us today so we can review your case, look at the evidence, confront the entities involved, and get your money back.