10 Biggest Cryptocurrency Scams in 2024
The growth of cryptocurrencies has helped attract both investors and scammers. The more huge the crypto market is, the more fraud opportunities come along with it. So, if you want to protect yourself from possible scams, be vigilant.
We will cover the biggest crypto scams and efficient tips for staying informed and safe.
Common Crypto Scams of All Times
There are several forms of cryptocurrency fraud. Among the most prevalent are:
Bitcoin Investment Schemes
Rug Pull Scams
Phishing Scams
Investment/Opportunity Scams
Fake Apps Scams
Giveaway
Man-in-the-middle (MITM) Attack
Fake Crypto Exchanges Scams
Jobs Offers Scams
Romance Scams
1. Bitcoin Investment Schemes
Scams relating to investment in Bitcoin are on the rise. Con artists pose as highly successful investment managers who made billions by trading in Bitcoins.
The scams usually demand some upfront fee, which they pocket and never invest. They can also ask for your personal information to access your cryptocurrency.
2. Rug Pull Scams
The rug pulls con artists use schemes to promote new projects, coins, or non-fungible tokens. They do it to raise capital. Scammers take money, disappear with it, and then return. Customers are left with a worthless investment.
The Squid coin fraud was one prominent example of this scam. Investors needed to engage in gaming to earn cryptocurrency. They needed to have game tokens and trade them for further cryptocurrency.
From one cent to more than $90 per token, the value of the Squid coin has increased.
Trade ceased, and the money vanished. As people tried to sell their tokens but could not, the token value dropped to zero.
These investors contributed about $3 million to the scammers. Scams involving rug pulls also involve non-traditional assets (NFTs).
3. Phishing Scams
Phishing scams are old and still common. Scammers send emails with harmful links to get personal information from victims.
Steer clear of these frauds by never entering sensitive information over an email link.
4. Investment/Opportunity Scams
Investment cryptocurrency scams usually start on social media, dating apps, or websites. They promise large sums of money with "zero risk."
A strange text, email, or phone contact can be the start of these frauds.
5. Fake Apps Scams
Scammers also use downloaded bogus apps to trick cryptocurrency investors. Many organisations are affected even if these scam programs are identified.
6. Giveaway
In scams referred to as "giveaway crypto scams," con artists promise to match or increase the amount of cryptocurrency sent to them. Sensible messaging has the power to establish urgency and legitimacy.
7. Man-in-the-middle (MITM) Attack
This scam happens by intercepting WiFi signals from reliable neighbouring networks.
The only way to stop these attacks is to remove the middleman using a virtual private network (VPN).
The VPN encrypts all data transmitted. Hence, the hackers cannot access personal data or steal cryptocurrency.
8. Fake Crypto Exchanges Scams
Investors may be seduced by scammers who promise amazing cryptocurrency and perhaps even more Bitcoin. But there's no exchange, and once they lose their money, the investor has yet to learn they've been conned.
Stay with well-known cryptocurrency exchange marketplaces.
Before entering any personal information, research and visit websites related to the business. In this way, you can learn more about the authenticity and reputation of the exchange.
9. Jobs Offers Scams
Scammers will pose as recruiters or job searchers to access Bitcoin accounts. They want cryptocurrency in exchange for work training with these crypto scammers. But they also guarantee an exciting career.
There are more frauds to stay away from while hiring remote workers. When hiring remote workers, there are additional scams to watch out for.
North Korean IT freelancers are trying to take advantage of remote work prospects by pretending to be in the US and putting together impressive resumes.
10. Romance Scams
The romance scam is another type of traditional scam that has made its way into the cryptocurrency arena.
A scam artist establishes a relationship with someone they meet online in this fraud. The scammer frequently professes their love for the victim soon after the connection starts.
Scammers desire to see the victim but cannot pay for the travel costs. These scammers will spend months evoking love sentiments in you, after which they either:
Demand cryptocurrency payments
Entice you to invest in cryptocurrency with them
Avoid Crypto Scams and Stay Vigilant!
Without a doubt, crypto platforms are the digital future of the globe, and authorities must regulate this vital industry.
One possible method to stop unethical actors in the cryptocurrency market is to use the Customer Due Diligence (or CDD) technique. It will keep a complete record of all users' financial transactions in addition to helping authorities confirm users' actual identities.
Know Your Customer screening methods can help verify every user during onboarding through their documents in real time. A reliable KYC system verifies a customer's identity through biometrics and compares it with the information on their identification cards.
For more crypt-tax-related information, contact Crypto Accountants.