Like any other financial scams, crypto scams also attach to people’s assets, but they do on the crypto assets rather than the cash. It is essential to learn about cryptocurrency scams to be able to avoid and tackle them as the need arises. Crypto scammers use several tactics to lure investors and influence them to purchase fake assets or ones with way lower value than the one communicated.
Most frequent crypto scams
There are various types of crypto scams. To learn about these scams in detail, check the below information:
- Fake websites and apps: One of the most common ways scammers use it is by designing fake websites for crypto trading or counterfeit versions of popular apps and websites that require crypto wallet logins. These fake ones have similar yet different domains that are often tough for people to spot. The apps used by scammers are often available for download online, thus confusing the users.
- Phishing scams: Most crypto phishing scammers target the wallet details of the users; the wallet’s private keys required for accessing the funds are hugely targeted. For this, the scammers send emails enticing the receivers to a specially designed fake website where the details are further asked, including the private key. Hackers then steal the acquired details from those wallets and the assets.
- Pump-dump schemes: In this scam type, a con artist popularises specific crypto tokens via social media or emails. This influences the traders into instantly buying them, hoping to get benefitted further with increasing values. However, these con artists further liquidate the shares as they attain a high price, leading to a downfall in the asset’s value.
- Fake celebrity endorsements: Hoping to attract potential investors, crypto scammers make false claims related to endorsements from top business people or celebrities and influencers. They also do fake marketing and attract top investors into making massive purchases.
- Giveaway fraud: In these types of frauds, some con artists guarantee to multiply or match the paid crypto. They often do creative messaging from legitimate-appearing social media handles to raise a sense of urgency and legitimacy. Further, people get influenced into sending money instantly to receive immediate and higher returns as these opportunities appear unique.
- Extortion and blackmails: Scams involving extortion and blackmail are another tactic that scammers use. They send threatening emails and messages to people, stating to reveal their visits to adult websites or leaking their messages. And to be safe from that, the users are forced into sharing their secret keys or transferring their assets to scammers.
- Scams related to cloud mining: This is about the businesses which allow you to rent minting tools and equipment in return for a set value and profit percentage. This allows anyone to remotely mine without actually investing in cost-taking mining hardware. However, many of these businesses are fraudulent and unproductive, leading you to lose your assets or make much less than the expected value.
- Initial coin offers (ICOs) that are fraudulent: ICOs refer to the way for new crypto businesses to attract potential audiences and raise funds from them. The users can send bitcoin or other active tokens or coins in exchange for a few discounted ones. Many ICOs proved to be fraudulent, and scammers influence investors successfully to indulge.
It’s essential to file reports for cryptocurrency scams, whether you have been a victim or have observed anyone else being one. And for that, it is crucial to learn about cryptocurrency scams. With that, the authorities can look at the scammy businesses and prevent them from working further. It is essential to have adequate knowledge before stepping into the crypto world.