Losses from crypto frauds are expected to increase in 2022
A decade ago, cryptocurrency made heads turn. Bitcoin along with a few other cryptocurrencies entered the investment market. The blockchain philosophy enabling crypto transactions attracted many investors globally. Also, the working model of decentralized finance made way for additional investments. Crypto investments eliminated the role of banking agencies in undertaking financial transactions. If you are interested in the Crypto market and want to invest in the same, visit a reliable Trading Platform.
Along with crypto investments, there has been an increase in the number of crypto scams as well. Various investment experts have raised concerns about crypto scamming and losing huge funds. Recent research estimated more than 21 billion losses reported through crypto scamming. This includes promises for higher returns and tokens that raised funds and pulled out. Hence, you need to understand the crypto world before making any investment. Along with the type of tokens you also need to have an understanding of the exchange. There are various popular exchanges in the market. You must create your account on any of these to protect your funding.
Market performance in 2022
Unlike previous years, 2022 is giving us a depressing market performance. Major popular currencies including Bitcoin and Ethereum did not survive the market pressure. The price of Bitcoin was reduced to $10k per token. The story is not different for other tokens as well. The market also witnessed the popular stable token Terra being washed out completely.
With the market trying to sustain the pressure there is also a higher chance of crypto scams. Many investors who lost their money through this market crash could fall prey.
Let us take a look at the common scamming reported in cryptos.
This is indeed the most common type of scam in the crypto world. In the past year, there have been reports of $500 million on a crypto scam involving huge returns. How do scammers gain an advantage here? Now, this is a fundamental question. Many investors who try to make their crypto investments do not carry much knowledge about cryptos. In such cases, instead of doing it by themselves, these investors rely on such third parties. These scammers promise a higher return and collect funds. These scammers also provide investors with websites and apps that allow them to monitor growth. It takes a while for them to realize the scamming trend behind such investments.
Romance scams are another type of investment scam. Now do not go overboard with the name here. The scammers here show off their wealth and earnings through cryptos. Investors fall prey to such trends and try to gain investment tips. With each progressing day, these scammers charge a tip for their investment ideas. In other words, this is a tutorial kind of scamming. Various offers including courses are made available to investors. The highest loss reported on this type of scam is $10k by an individual.
Yet another type of scam that needs your attention is the business and government investment scams.
The total losses on this model have been reported at $133 million so far. How does this scam start? As a customer, you might have come across various advertisements on social media. Say, you could buy a product from Amazon or a pop-up about a security alert. What happens when you click these links is the question. Scammers get in touch with the customers directly and advise them to exchange their funds for cryptos. Scammers are also able to provide investors with a convincing story. These customers receive the QR code of any crypto ATM to transfer their funds. This QR code is linked to the bank account of the scammers and all your money vanishes during the fund transfer. Additionally, you also do not have access to any contact of these scammers enabling you to recover funds.
Here are a few key tips that you may like to remember to escape crypto scamming.
Scammers are going to promise higher returns for minimal investment. The crypto market is volatile but it does not guarantee profits alone. Stay away from resources that give you investment advice. Ensure that you have a legit source of information when it comes to investing.
In the current trend, there is high speculation of scamming activities to increase in 2022. As an investor, you need to stay vigilant to avoid these scams.