Cryptocurrency (crypto) crime is on the rise. 2021 alone saw a record-breaking $14bn of crypto stolen by fraudsters. And because it’s an industry that isn’t regulated, like the traditional investment and banking sector, it’s really up to the individual to protect themselves against criminals.
Here are five common crypto scams to look out for.
1. Imposter websites and fake apps
You might get a legitimate tip for a new crypto currency, however scammers take advantage of this by creating fake websites and apps that look like the real thing. Check for red flags such as incorrect branding or spelling, no security padlock icon for the website, no https in the url etc.
2. Fake initial coin offerings (ICOs)
It’s not uncommon for scammers to send emails announcing fake ICOs – a type of crowdfunding using crypto – and steal the funds they receive.
3. Digital collectibles and games.
Scammers are known to lure new investors into buying a new crypto or game tokens just to drive the price up. At that point, they will sell their own holdings at the inflated price and disappear.
4. Investment scams
Fraudsters will attract people to buy crypto by presenting an “unmissable”offer if they invest. However, once you’ve completed your transaction, the offer never appears and you never see the money again.
5. Loader/ load-up scams
In this case, scammers will ask to borrow your crypto account using an excuse such as, “they need a higher limit.” However, once they have your account logins, they will steal the crypto that is in your account. That’s why it’s important to never give your account details to anyone.
Crypto scams are on the rise because it’s still a fairly new concept, and fraudsters can take advantage of new investors’ lack of experience. However, as with any cyber technology, it’s crucial to take basic security measures and be aware that there are bad actors out there. Make sure you do your research before investing.