Network scams! – In France, theFinancial Markets Authority (AMF) is sounding the alarm on the crypto scams which represent a quarter of scams. To United Statesthe Federal Trade Commission (FTC) releases a report about these scams. This highlights the explosive cocktail between social networks and cryptocurrencies in terms of fraud.
Crypto scams on social networks: targeted 30-somethings
A June 3, 2022 report from the Federal Trade Commission of the United States points out that “Social media and cryptocurrencies are an explosive combination for fraud”.
About the half people reportedly said that they had lost their cryptocurrencies to a scam since 2021. Indeed, they reportedly indicated that their misadventures began via a post on a social network.
The Commission refers to the figure of 46,000 people having declared having lost, since 2021, more than$1 billion in cryptocurrencies following a scam.
The report estimates that during this period, almost 40% of losses due to fraud from social networkswere in cryptocurrencies – a higher figure than other payment methods.
instagram, Facebook, WhatsAppand Telegram would be the main platforms reported as being used by fraudsters.
Regarding the victims, the people aged 20 to 49 would be 3 times more likely to report the loss of their cryptocurrencies due to a scam. The thirties would additionally be ” most affected “.
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Methods of scammers on social networks
The frauds reported to the Commission originating from social media and resulting in the loss of cryptocurrencies are believed to be largely investment scams. $575 million losses since 2021 would relate to false investment opportunities. This amount is much higher than other types of fraud.
Cryptos “false promises of easy money”
The crooks would use an almost similar mode of operation: “false promises of easy money”while exploiting the victims’ lack of knowledge about cryptocurrencies.
Scammers offer Web sites and apps where their targets are supposed to deposit their cryptocurrency investments. From then on the performance of the investment is monitored. Withdrawing capital from victims and their earnings then becomes child’s play.
In reality, the victims’ cryptocurrencies deposited on these sites or applications are sent to the wallets of the crooks. Of course, the investors concerned can no longer recover their assets.
The new love potion cryptocurrency
The “romance scams” are responsible for the loss of $185 million in cryptocurrencies declared to the Commission. .
In this type of scam, the scammers display conspicuous signs of wealth to their victims. Charmed, they are thus convinced that they are experts in their field. Subsequently, they offer advice and support services for investors who wish to dive into cryptocurrencies.
Victims belatedly realize that they have actually received a tutorial on “sending cryptocurrencies to a scammer”.
Identity theft scams
Scams by identity theft of businesses and governments have led $133 million cryptocurrency losses since 2021. Scammers can go so far as to impersonate a border police officer.
The latter put pressure on their victims to convert their money into cryptocurrency. The pretext being that this process aims to protect their assets from freezing “as part of a drug trafficking investigation”. The fake agents will then help these people send their cryptocurrency to an address that belongs to the bandit. The victims then no longer have access to their funds.
Unfortunately, the scammers profit from the rise of cryptocurrencies at the expense of their victims. Thus, investors must learn to spot red flags to avoid crypto scams, but also NFT scams.
Stay away from spammers and scammers of all stripes, avoid too-good-to-be-true offers like the plague, and get into the habit of showing healthy suspicion. On the other hand, also learn to place reasonable trust in respectable and recognized players in the ecosystem. The FTX platform falls without a shadow of a doubt into this second category. Come acquire and trade your first bitcoins and other cryptocurrencies by registering on FTX. You will benefit from a lifetime discount on your transaction fees (affiliate link).