If you’ve been investing in crypto, you’re probably aware of the many scams out there. These criminals are based online and can lure you in with attractive profile pictures, or even worse, with phony websites. They will tell you about huge gains on the cryptocurrency market and get you to follow them into investments that at first look very promising. They may even use a fake website to trick you into believing they are from a trusted source.
It’s very easy for scammers to lure you into investing by offering limited-time offers and other incentives. Some of these companies will even offer discounts or bonuses, so don’t ever invest in them without doing your homework. Social media and Google ads are prime targets for scam artists, as bad actors have used them to sell you fake websites. They’ve even stolen $500k in cryptocurrency in 2021, according to Mark Fidelman, a marketer at SmartBlocks marketing agency.
Many scams involve the use of emojis to create a false hype for a cryptocurrency. This scam usually involves a small number of insiders marketing the cryptocurrency in order to attract unsuspecting investors. During the hype, the price of the cryptocurrency skyrockets. The insiders then sell their shares and run away with the money. In the end, you are left with worthless coins. A good way to spot a crypto scam is to look for a social media account with little or no history.
Another popular scam in the crypto world is the social security scam, in which a fake company claims to be the Social Security Administration. However, it’s important to note that a cryptocurrency payment transfer cannot be reversed. In some cases, consumers have recourse to chargebacks. This is why nearly half of cryptocurrency scam victims lost their money using social media. These platforms include Facebook and Instagram. This makes it even harder to trace transactions back to their source.
A recent study by the Federal Trade Commission found that one in four dollars are lost to crypto-related crimes. Those victims are mainly young and risk-taking. Despite the volatility of the cryptocurrency market, they still seem to be attracted to its potential as a safe and lucrative investment option. However, many of these scams are based on emotions and social engineering. The idea is to entice the victim to transfer their cryptocurrency to the scammer or provide access to their coin wallet. Those scams are also largely based on traditional scams that involve stock manipulation, theft, or malice for profit.
As cryptocurrency prices continue to climb, scammers have created more opportunities to defraud investors. In 2021, the total value of stolen cryptos reached $14 billion. That’s why you should be cautious with crypto investments. There are ways to protect yourself against these scams, which only require minimal time and effort on your part. The FTC also warns against mixing dating advice and investing advice online. If you’re a beginner looking to invest in crypto, remember to keep these steps in mind.