Analysts and crypto experts are warning against all levels of bitcoin scams, which have become rather common over the past year.
Bitcoin and Crypto Scams Continue to Be Troublesome
Since bitcoin began shooting up in price in mid-2020, crypto scam artists have been entering the fray in droves. The Federal Trade Commission (FTC), for example, received more than 7,000 individual reports of crypto scams between October 2020 and March 2021. As much as $80 million had been stolen from investors. This represents a 1,000 percent hike over the previous year alone.
Adam Levin – a cybersecurity expert – explained in an interview:
Bitcoin-related scams track with other criminal exploits online until you try to recover your assets. Cryptocurrency is designed to be hard to track and even more difficult to recapture. Once transferred, it’s gone, with a few very high-level exceptions… Always take a moment before clicking on links sent via email or SMS, and don’t install apps on your mobile device unless you’re 100 percent certain they are legit by checking the reviews on the platform where you found them.
Right now, bitcoin scams are taking on three primary forms. They are:
- Investing scams
- Giveaway fraud
- Romance scams
The first involves illicit actors contacting individuals and telling them about great new opportunities through which to earn crypto funds. If you start out by investing a little crypto, you’ll likely garner huge returns in the long run. All you need to do is put a little bit into a specific account, then watch it grow.
Typically, these accounts are run by the scammers themselves. While the investment is likely to surge in price, many times those who seek to make withdrawals either can’t at all or are asked by those in charge to pay fees to make the withdrawals.
When it comes to giveaway fraud, we saw a huge example of this in the summer of 2020, when figures like Barack Obama and Elon Musk began “posting” on their Twitter accounts that they were looking to provide bitcoin funds to anyone willing to donate. Give a certain amount to a specific address, and you’ll double your money.
Someone Else was Calling the Shots
What happened was that someone had taken control of their Twitter pages and was posting these messages independently. Over $100,000 in BTC was sent, but it was never doubled or returned. Eventually, the person responsible for the scheme was jailed in a juvenile detention center as part of a plea deal.
With romance scams, usually someone finds the perfect mate on a social dating site. Things are going well, and the conversation is great until that person either asks for crypto because they’re experiencing financial trouble, or they tell the victim to invest in a new platform. Both usually lead to lost funds, bruised egos, and empty pockets.