Investment frauds are nothing new. They have been going on for ages. A couple of decades ago, credit card scams were also becoming popular. Now, in the age of digital transactions, cryptocurrency scams are all the buzz.
The number of cryptocurrency and cryptocurrency exchange scams is increasing every day. Victims of these scams have to reach out to various scam recovery services for help. These services can get the money or crypto back with the right information. However, it’s always better to be safe than sorry.
So, let’s look at four crypt scam stories that can teach you a thing or two about how these scams work.
#1 The Squid Coin Incident
In 2021, the Korean TV series, Squid Game, became the most-watched show on Netflix. It was a popular show and had a massive worldwide audience. Squid Game was arguably the best show on Netflix that year.
Soon after the show’s success, the internet learned about a Squid Game cryptocurrency called Squid Coin. The crypto was in no way connected to the show. It capitalized on the show’s popularity and named itself Squid Coin.
Somehow, Squid Coin began attracting tons of buyers. At one point, each coin cost around $3,000. All looked well until one day, the coin’s value went from $3,000 to $0 within minutes. The creators of the crypto vanished with $3 million.
Crypto scams like this capitalize on pop culture’s influence on the people. The moment scam artists see something gain popularity, they think of cryptocurrency scams centered around it. That’s arguably the most effective modern approach to scamming people.
So, the next time you think about investing in crypto, don’t do so simply because of the hype. Do your research on the currency creators and find out what their motives are.
#2 The Indiana Phone Scam Incident
A 77-year-old woman in Indiana lost over $12,000 in crypto because of a phone scam. The scammer made the woman believe that something was wrong with her digital wallet, and she needed to pay a fee to fix it.
Not knowing any better, the woman did what the scammer told her to do and ended up losing $12,000.
Although this may seem like carelessness, it’s a lot more than that. Scammers specifically target people with little to no idea about how crypto works. That way, they capitalize on the lack of knowledge and fool people into giving them the money willingly.
Never believe anyone who calls you inquiring about your digital wallets. No digital wallet or financial service is allowed to do that. Call your respective customer support team immediately inquiring about such calls if you ever receive any.
#3 The 2020 Twitter Account Hijacking
In 2020, famous personalities like Barack Obama, Bill Gates, and Elon Musk, announced a giveaway on Twitter. They said they would give back twice the number of Bitcoins someone sends them within a few hours.
It was too good to be true, but people had no reason to question these Tweets. After all, why would Bill Gates and Obama scam people, right? It turns out it was indeed a scam, but the users had no idea what was going on. So, people lost a ton of money because they believed in these personalities and their verified Twitter handles.
So, what happened?
The Tweets did come from verified accounts, but the accounts were hacked. The hackers managed to scam people by making them believe that the giveaway was legit.
Never believe everything you see on social media. Always look for warning signs. Famous personalities won’t suddenly announce such giveaways. At least do your research on legitimate news sites to see if they announced anything like that beforehand. Otherwise, there’s every reason for you to doubt such announcements.
#4 The Tana Mongeau Crypto Scam
22-year-old social media influencer Tana Mongeau promoted crypto called Titscoin. The crypto pretended to donate 5% of its liquidity pool to breast cancer research. Tana is popular in the internet community for all the wrong reasons, and it turns out she was about to add to that tally.
Tana explained to her millions of followers how she managed to buy a Rolls Royce with profits from her initial Titscoin investment. However, it turns out she, too, was scamming people. Titscoin was losing its value even when Tana was promoting it. Tana never intended for her fans to get rich or donate to breast cancer research. She did it for herself and a few quick bucks.
Thus, you should never let your favorite internet celebrities or internet personalities manipulate you into making such financial decisions. Only they get to benefit from your losses, and they won’t even care about you afterward. Always verify calls and messages from financial institutions too. Be as safe as you can
A crypto scam is a fraudulent activity wherein an individual or group attempts to deceive investors with false or misleading information regarding a cryptocurrency in order to gain an unfair financial advantage.
Common crypto scams include Ponzi schemes, pump-and-dump schemes, fake initial coin offerings (ICOs), and fraudulent exchanges.
You can identify a crypto scam by looking out for red flags such as guarantees of high returns, pressure to invest quickly, and requests for personal information.
Individuals with little to no understanding of cryptocurrency are most likely to be victims of crypto scams.
To protect yourself from crypto scams, research any potential investments thoroughly, be wary of promises of high returns, and never invest more than you can afford to lose.
Yes, crypto scams are illegal and can be prosecuted under criminal law.
Yes, there are organizations such as the Crypto Victims Association (CVA) that provide support and resources to victims of crypto scams.
The consequences of getting scammed in cryptocurrency can include financial losses, reputational damage, and psychological distress.