How to spot them and protect your money

It is estimated that around $2 billion will be lost by investors in 2023 due to scams, kickbacks and hacks. Although the technology is becoming more secure and stable, and many users are more aware of the tricks used to steal assets, there are still ways for thieves to withdraw your crypto if you are not careful.

Experts at Kryptocasinos.com have compiled a list of the most common scams used in 2024 and how you can spot and avoid them. The data was collected from the Department of Financial Protection and Innovation’s (DFPI) ‘Crypto Scam Tracker’, which has up-to-date scams as they are reported, including descriptions of the scams and the names of the fraudulent sites.

Most Common Crypto Scams

Fraudulent Trading Platforms

Of all the scams reported by the DFPI, 87% included an element of using a fraudulent website or trading platform. These scams involve a fraudulent website or app that convinces victims to deposit funds on the platform under the guise of accessing a unique investment opportunity or being a trusted website. The fraudulent platforms appear legitimate, even going so far as to replicate price movements and produce artificial profits. These platforms are often advertised online and may look identical at first glance.

How to avoid these scams:

To avoid these scams, investors should only invest money in trusted exchanges or move crypto to trusted wallets. By following this, you can ensure that your money will be safe and protected. If in doubt as to whether the website is legitimate, double check the URL to ensure it is the official website, there are many sites online that can check URLs for you and warn you if they are fraudulent, also if a website ‘s URL starting with HTTP instead of HTTPS can also indicate that the website is not secure.

If it’s an app, check the developer and app information. This can be done on your device’s app store, trusted apps will have developer names and further information including the number of downloads, which can be another good indicator of the legitimacy of a platform. You can also follow links from a platform’s official website. If a stranger pressures you to sign up and deposit funds on an unknown platform, this should be a red flag, and you should proceed with extreme caution.

Pig Slaughter Scam

A pig slaughter scam is a long-term scam and investment fraud, in which the victim is gradually tricked into contributing more and more to a fraudulent cryptocurrency scheme. This is called a “pig slaughter” scheme because the perpetrators will “fat” a victim to gain their trust before “butchering” them.

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They are mainly carried out through social media platforms and try to get the victim to transfer money to a fraudulent platform. The fraudulent platform usually pretends to be real and offers artificial profits to keep the victim using the platform and perhaps making more deposits. However, the victim is never allowed to take their money out of the site and may be required to send further money through various justifications (such as service charges or IRS taxes) before any money is taken out; this only adds to the already potentially large financial losses. This scam appeared in 58% of reports to the DFPI.

How to avoid these scams:

This is another scam that can be avoided by staying online carefully; Criminals can also contact victims via WhatsApp and SMS. The best way to stay safe is to completely ignore and block messages from strangers. Some scams now even try to impersonate family and friends, so it’s even more important to make sure you know who you’re talking to. Scammers will never want to meet and may not want to talk on the phone if they are pretending to be someone else as this will reveal their real identity or they are not who they say they are and therefore if they are too shunned , this is a clear red flag.

Fraudster scams

An impostor scam occurs when a scammer poses as a reputable company, government representative, or well-known individual in order to gain access to a user’s systems and personal data for financial gain. The scammer may also use other scam techniques and try to get victims to deposit money on fraudulent platforms.

Many scammers will use social media to find their victims, starting conversations on platforms like Facebook, Instagram and LinkedIn, and some will try to move conversations to WhatsApp. This scam was mentioned in 27% of all reports to the DFPI. An example of this, reported by the DFPI, was a scam where people impersonated BlackRock, a legitimate investment firm, on Facebook and WhatsApp to recruit victims to trade crypto options, promising high daily returns. However, the links were fraudulent at the time, meaning any money deposited would be stolen.

How to avoid these scams:

If you are contacted by strangers on social media, it is important to remain cautious; any message trying to convince you to invest in crypto should be considered a red flag. If someone asks to move the conversation to WhatsApp, this can also be a big indicator that someone might be trying to scam you, so it’s best to block and log the account. Companies like BlackRock mentioned above will never reach out and ask you personally to invest; it can also be checked by ensuring that links to these sites are legitimate and not fraudulent.

Romance scam

Romance scams are another very popular type of scam that uses the popularity of social media and dating platforms to adopt a fake online profile to gain a victim’s love and trust and then use the illusion of a romantic or intimate relationship to manipulate and/or steal from. the victim. The DFPI crypto scam tracker reported a case that happened to a California resident who reported meeting “Mark” on the dating app Bumble. Mark asked the victim to move the conversation to WhatsApp. They continued to communicate, and at one point Mark told the victim that he could teach them to trade cryptocurrencies. Mark convinced the victim to deposit money into a fraudulent platform where the money would eventually be stolen, resulting in the loss of over $50,000. This scam appeared in 11% of reports.

How to avoid these scams:

Just like fraud scams, any stranger trying to entice you to invest money should be approached with caution. Online accounts often use stolen photos and videos to give the illusion that they are real people, and it is often difficult to spot these accounts. Images can be searched back on Google to see if they were taken from somewhere else; for example, the report on ‘Mark’ said that after research, the scammer was found to be using photos of a popular fitness personality.

A spokesperson for Kryptocasinos.com said: “In the world of cryptocurrencies, scams are a real threat, so it’s important to stay safe. Always do your research and make sure you’re using trusted platforms and wallets.

“Never share your private keys or personal information with anyone. Be wary of offers that seem too good to be true, and check everything before investing. By staying informed and being careful, you can protect yourself from scams and secure the benefits of cryptocurrencies.”

“Most Common Crypto Scams in 2024: How to Spot Them and Protect Your Money” was originally created and published by International Accounting Bulletin, a brand owned by GlobalData.

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