How crypto scams duped investors of USD 1 billion

More than 46,000 people have reported losing over USD 1 billion (over Rs 7,000 crore) in cryptocurrency scams since the start of 2021, the Federal Trade Commission (FTC) of the United States said in a report on Friday, June 3.

Nearly half the people who reported losing digital currencies in scams said it started with an ad, post or a message on a social media platform, reported Reuters quoting the FTC.

The FTC said that crypto-related crimes amount to about one out of every four dollars reported lost to fraud in the US, which is more than any other payment method.

At 70 per cent, the majority of those who reported being duped used Bitcoin to pay scammers, followed by Tether and Ether, reported CNN.

HOW THE SCAMS WORKED

The FTC report says that most of the cryptocurrency losses consumers reported involved bogus cryptocurrency investment opportunities, which totalled USD 575 million in reported losses since January 2021.

These scams falsely promise potential investors that they can earn huge returns by investing in their cryptocurrency schemes, but people reported losing all the money they invested.

SOCIAL MEDIA'S ROLE

Reports suggest that cryptocurrency-related scams often begin on social media.

Nearly half of the consumers who reported a cryptocurrency-related scam since 2021 said it started with an ad, post or message on a social media platforms.

YOUNGSTERS MORE PRONE TO CRYPTO SCAMS

People between ages 20 to 49 were more than three times as likely as older age groups to have reported losing money to a cryptocurrency scam.

Older age groups, however, reported losing more money when they did report a cryptocurrency-related scam.

RED FLAGS TO WATCH OUT FOR

• Beware of anyone who claims they can guarantee profits or big returns by investing in cryptocurrency.
• People who 'require' you to buy or pay in cryptocurrency.
• A 'love interest' who wants to show you how to invest in cryptocurrency or to send them cryptocurrency.