Compared to other countries, Americans have lost billions in cryptocurrency scams in a year. The Federal Bureau of Investigation (FBI) reported that Americans lost $5.6 billion in 2023 alone. That’s massive, considering that digital assets are in their nascent stage not only in the US but across the globe.
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Cryptocurrency scams accounted for around 50% of all financial crimes last year. The increase in crimes indicates that technology has made it easier for scamsters to cheat innocent individuals.
Cryptocurrency Scams on the Rise in America
Fraudsters’ Methods to Lure Victims
Fraudsters have found several ways to lure their victims and drain their cryptocurrency wallets. Their modus operandi includes fake gaming apps, pig butchering schemes, and gaining access to their wallet seed.
For the uninitiated, pig-butchering is another word for a ‘romance scam,’ where scamsters target lonely web users and manipulate them for money.
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Romance Scams and Pig Butchering
They build an online relationship with the users and behave like they are dating and caring for each other. The communication mostly takes the romantic route with frequent messages about ‘taking care’ of each other.
The main motive is to gain their trust and eventually get access to their cryptocurrency wallets. Read here to learn how pig butchering works and how to avoid it.
Telegram Groups and Fake Investment Signals
Another method includes creating a Telegram group where the admins signal to buy and sell options for profits. They promise users huge profits on their cryptocurrency investments with little to no risk. Once the payment is made, the scamsters block the user, leaving them with no option to contact or complain.
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FBI Statement on Cryptocurrency Scams
“Over the years, cryptocurrency’s widespread promotion as an investment vehicle, combined with a mindset associated with the ‘fear of missing out (FOMO),’ has led to opportunities for criminals to target consumers and retail investors,” read the FBI report.
