Mimimika.com

Cryptocurrency Scams

5

Scammers frequently tempt unwary individuals into sending over their cryptocurrency assets by offering giveaways or promising high returns on investments. Before investing your funds into any new cryptocurrency investment opportunity, always conduct thorough research. The actual Interesting Info about Mitigating the Risk of Investment Scams.

Be wary of any company that requires you to share private keys or wallet information—legitimate businesses will never need this of their customers.

Fraudulent Investment Opportunities

Cryptocurrencies’ volatile values make them an appealing target for criminals. Unlike traditional investments, virtual currencies do not rely on government or central bank money as backing and are thus subject to far fewer regulations. Fraudulent opportunities in cryptocurrencies include fake token sales, pump-and-dump schemes, and proof-of-work fraud, where criminals artificially inflate token supply to create the illusion of demand.

Cybercriminals often use social media to promote fraudulent cryptocurrency investment opportunities. A celebrity social media account could encourage followers to invest in their project by sending crypto assets with promises of higher returns than the initial investment cost. However, in reality, fraudsters will take victims’ funds directly for themselves or nonexistent cryptocurrency exchanges.

Scammers may create fake websites or apps that appear to be legitimate crypto asset trading platforms, duping victims into depositing funds that cannot be recovered after they have been sent overseas. This practice is similar to chain hopping, which involves laundering proceeds from illicit activities into new cryptocurrency ecosystems.

Phony Celebrity Endorsements

Fake celebrity endorsements can often be seen on right-wing websites promoting dubious medicines and cryptocurrency scams. The publisher earns a small commission whenever a reader clicks on the ad. Oprah Winfrey, Dolly Parton, Reba McEntire, Twitter/Tesla Owner Elon Musk, and Ryan Reynolds are often among those featured in these deceptive ads.

According to ABC reports, scammers frequently employ celebrities’ images and names to promote dubious investments on social media. They may also create subscription traps involving hidden recurring charges for weight loss products or beauty items.

This practice can be disastrous to celebrities and individuals who agree to become victims of such fraud, as well as those persuaded into participating. Therefore, anyone offering investments or selling them must conduct a thorough background check, including the registration status of any individual recommending or selling investments, and read any prospectuses or financial reports related to those investments before investing.

Phishing

Phishing cryptocurrency scams occur when cybercriminals send fraudulent requests for cryptocurrency payment, often along with false messages stating that an account has been compromised and that they need to take immediate steps.

Scammers who claim they offer crypto giveaways through fraudulent social media posts or ads often employ celebrity endorsements and urgency as bait to dupe victims into divulging sensitive data or taking actions that give them access to digital wallets and authentication codes. Such schemes, known as ‘giveaway crypto’ schemes, use social engineering techniques such as manipulating people into divulging confidential data that allows fraudsters to gain entry.

Ransomware is another common cryptocurrency scam in which hackers gain access to your computer systems or private networks and encrypt all the data stored there before demanding a fee in crypto assets as payment to unlock it. The criminal often provides instructions on how to use cryptocurrency assets as payment.

Cryptocurrency users should understand that both the Federal Trade Commission and their respective cryptocurrency exchange can help them recover stolen assets and collect evidence such as communication transcripts, transaction records, screenshots, or any other pertinent details.

Fake Exchanges or Wallets

Scams in cryptocurrency mirror those in other industries. Be wary of any communication that appears suspiciously like spam or strongly suggests investing. Scammers could use phishing tactics to gain access to digital wallets or authentication credentials that could allow them to steal coins.

Faux crypto exchanges or wallets may be set up with the intention of taking money without fulfilling promised returns, while malware infections may give scammers access to private keys or wallets on infected devices.

Be wary of investment schemes that promise unrealistic returns or require personal details like your private key, as legitimate projects should always provide full disclosure on their team, partnerships, and development process. It’s also wise to only invest in cryptocurrency assets you understand as well as monitor apps that store or authenticate credentials for account-authentication credentials; for instance, last year, three versions of an illegal Poloniex app made their way onto Google Play before being removed, allowing fraudsters access to steal the keys of thousands of users.

Ransomware

Hackers often target cryptocurrency because it’s easy for them to obtain. Ransomware attacks are one of the main ways scammers gain control of a computer or wallet and demand payment in cryptocurrency to restore access.

Scammers often exploit fake apps available on popular app stores like Google Play and Apple’s App Store to siphon cryptocurrency from you, often through malware infection on computer or phone devices.

Extortion is an outdated cryptocurrency scam in which scammers attempt to convince you that they possess embarrassing information about you, such as photos or confidential files, that would compromise your safety unless a payment is made immediately.

When it comes to avoiding crypto scams, it’s vital to educate yourself and your employees on how to recognize suspicious emails or websites. Also, consider keeping your crypto in an offline wallet, known as a cold wallet, for added protection against such threats. Norton 360 with LifeLock Select can assist with that as it monitors dark web activity to notify you if your identity is being sold for illegal use.

Read also: How to Write a Letter to Bank Manager For Education Loan Second Installment