Common Cryptocurrency Scams in 2023
Digital currency is a currency form held within a digital wallet, allowing its owner to convert it into cash by transferring it to a bank account. In contrast, cryptocurrency, exemplified by bitcoin, distinguishes itself from digital currency by utilizing blockchain for validation and bypassing traditional financial institutions, making recovery from theft more challenging.
Despite being a relatively recent trend, cryptocurrency theft is employing age-old tactics. Below are some prevalent cryptocurrency scams warranting vigilance.
Bitcoin investment scams
Scammers who pose as seasoned “investment managers” approach potential victims of Bitcoin investment scams. The so-called investment managers deceive their victims by promising them financial success through investments and claiming to have gained millions of dollars investing in cryptocurrencies.
Romance Scams
Cybercriminals pose as an online romantic interest and win over victim’s confidence to the point where they request money transfers. The cybercriminal takes off with the money as soon as the victim does.
A similar methodology is used in romance scams, except the money is demanded in cryptocurrency, which is even harder to withdraw.
Fake Exchanges
Investors may be enticed by scammers with claims of a fantastic cryptocurrency exchange and possibly even some extra bitcoin. However, there isn’t really an exchange, and the investor doesn’t realise it’s a scam until they lose their money.
Flash loan attack
Short-term loans, like those for just a few seconds to complete a trade, are known as flash loans. These loans are common in the cryptocurrency market because traders utilize the money to purchase tokens at a discount on one platform, which they then promptly sell for profit on another platform.
An adversary exploits the ability to borrow money and uses it to influence prices on a DeFi platform. The attacker generates many buy and sell orders to inflate the price and provide the appearance of great demand. When prices rise, the attacker then cancels orders, which instantly lowers the price.
Social media cryptocurrency giveaway scams
When someone clicks on a fraudulent post on social media claiming to be giving away Bitcoin, they are taken to a fraudulent website that requires verification in order to receive the bitcoin. This verification process involves paying a fee to verify the legitimacy of the account, which could be lost, or worse, they could click on a malicious link that could lead to the theft of their cryptocurrency and personal information.
Fake Apps
Scammers utilize downloaded bogus apps to trick cryptocurrency investors. These fraudulent apps are swiftly identified and taken down, but that doesn’t mean they don’t affect a lot of businesses.
Ponzi schemes
Ponzi schemes use the money made from new investors to pay out to older ones. Cryptocurrency scammers will use bitcoin to entice new investors in order to obtain more funds. It’s a never-ending scam because there are no real investments—all it does is seek out new investors in order to make money.
A Ponzi scheme’s primary allure is the assurance of enormous riches with little risk. These investments, however, are never risk-free and may not always provide profits.
Fake Celebrity Endorsements
Fraudsters may exploit well-known figures without their awareness, leveraging their images to entice fans into fake endorsement schemes associated with cryptocurrency projects. Some prominent personalities have unwittingly become entangled in such scams.
Employment Offers
In their attempts to infiltrate Bitcoin accounts, scammers adopt the personas of recruiters or job seekers. They dangle the allure of an enticing career opportunity but demand cryptocurrencies as payment for supposed training in these crypto-related schemes.
Warning signs of cryptocurrency scam
- Ensures you’ll become wealthy quickly
- There is an urgent payment request.
- Intimidating messages
- It looks too good to be true.
- Requested payment in cryptocurrencies
- The address bar of a website does not start with “HTTPS.”
- There are a lot of positive evaluations for the post or commercial.
- Someone on social media is requesting that you utilise cryptocurrencies to make a payment.
- Uninvited employment offer
- Requests for uninvited favours
- We need your account logins.
What to do when you should be a victim of a cryptocurrency scam?
Taking swift action is paramount if you’ve fallen victim to a cryptocurrency scam. To mitigate further harm, begin by completely disengaging from the fraudulent individual. Submitting a complaint form through our platform entitles you to a free consultation with our team of experts. Our primary objective is to aid you in addressing your situation effectively and devising strategies to surmount the challenges you face.
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