2021 report: Online Bitcoin and Etherium scams soaring

A new report published today shows that bitcoin and crypto scams have soared since 2020. Hard to believe but the lure of huge profits is bringing in small investors who are getting shammed left and right.

The rise of bitcoin scams

The study by the Better Business Bureau shows the rise in crypto scams over the last two years. The BBB says that scammers are being attracted to the huge profits the crypto craze has brought with it. All you need to do is buy into a cryptocurrency and that’s it, for now at least. All of the profit will be up for grabs and all of the risk will be on you. One way that scammers are taking advantage of these novice investors is by selling fake cryptocurrencies. One such scam was the BitConnect scheme, which was shut down recently after the NYSE complained about suspicious trades. The man behind the scheme, Yuzu will not be facing charges but was ordered to return money and pay $35 million in civil penalties.

What are the most common scams?

The crypto and bitcoin space is a wonderful place for fraudsters to wreak havoc. The gray area between legitimate traders, scammers and entrepreneurs is easy to navigate and there are plenty of opportunities for unlicensed individuals to make quick cash. There are even well known individuals who tried to scam the market and end up losing millions. The most popular scams are operating in multiple cryptocurrencies such as Monero, Bitcoin, Zcash, and Litecoin. What do the regulators and government do about it? Governments and regulatory agencies don’t like to talk about it but the rampant nature of these scams means they have to. Especially since the amount of money and number of people being scammed is so high. Especially with Bitcoin and Ethereum which is exploding in the crypto world.

Why is there so much interest in cryptocurrencies?

Is it just for tax evasion? Or is it a new way to conduct everyday transactions? Will the government stop it before it gets too big? Will it die like its predecessors?

There are a variety of reasons why investors are into cryptocurrencies, but they all relate back to the blockchain technology and the decentralized nature of the virtual currency.

The blockchain is extremely secure and immutably verifiable and as such is gaining widespread traction as a secure method of tracking transactions. Many investors are now buying bitcoin, Ripple and ether (via the Binance exchange or others) because of the promise of positive returns and because of the potential for gain and the potential for greater security than what they are used to with fiat currency.

A report, released by the U.S. Federal Trade Commission, reveals that there have been more than 8,600 cases of scammers impersonating cryptocurrencies in the last three years. Worse, the FTC has noticed that the number of crypto-related scams has increased to 6,600 complaints per year.

The FTC also notes that scams are now the No. 1 complaint about social media platforms, including Facebook and Twitter, while almost half of the complaints were about marketing scams. The U.S. Securities and Exchange Commission (SEC) is among the top ranking regulators when it comes to cryptocurrency fraud.

“The good news is that the public knows cryptocurrency scams are a big problem. And so far, most of them have been identified and are being shut down.”

Just beware.

The report issued today by Blockchain Intelligence Group (BIG) found that in 2017 the total number of accounts who fell victim to cryptocurrency scams nearly doubled from 2016.

TechCrunch reports that the average cost of a cryptocurrency scam last year was $35,000 in lost investment.

Bitcoin Savings & Trust was a company that initially claimed it would pay out users 10 percent interest, but it turned out to be a ponzi scheme and had to shut down in 2013.

BIG also notes that since the start of 2018 there have been more than 600 scams with cryptocurrencies.

The bulk of these scams involve bitcoin.

In a survey from BIG’s conference held in September, the largest number of respondents (42 percent) said they lost money trading bitcoin, and 27 percent said they lost money

How can you avoid being scammed?

1. Don’t know what bitcoin is or don’t care Bitcoin is a cryptocurrency which was created as an alternative to government-issued currency. It allows you to store and transfer your money without the need for a third-party. It is known as a blockchain based currency and has been described by its inventor as a “definite revolution.” However, not many people are aware of what bitcoin is and they probably don’t know anyone who owns it. It’s another way to keep your money safe and that’s why we suggest you keep an eye out for scams. 2. Do your homework Once you are aware of what bitcoin is, then it’s a simple matter to research it online and check out reliable sources for information. However, according to that study it’s still a bit difficult to uncover reliable sources.


In a survey from BIG’s conference held in September, the largest number of respondents (42 percent) said they lost money trading bitcoin, and 27 percent said they lost money

Until now, scammers have been preying on unsophisticated investors looking to make money from the cryptocurrency craze. A total of 177 Bitcoin scams were detected in 2019, up from 83 in 2018, according to the first report issued by the association of Swiss banks.

All scammers are using anonymous and decentralized cryptocurrencies to pull off their schemes and all are financially motivated. However, the most common scams being run today are transferring funds from the victim’s bank account to a virtual wallet which later closes, leaving them with no funds.

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