One lingering trouble that the crypto industry has faced since its inception is the presence of scammers. While this is true of any financial industry, the crypto space seems to attract more of them. This might be because of the unimaginable gains that are deemed possible with cryptocurrency, especially in a bull market.
In the past few months, crypto scammers have wreaked havoc on the industry, by tricking people in a plethora of ways. New entrants to the space, due to the lack of their knowledge, are easy prey for these nefarious actors. As such, hundreds of millions of dollars worth of cryptocurrency worldwide have been lost.
The United States has actually studied this and found that there has been an uptick in scam activities in the last couple of months. As those in the crypto industry know, the last few months have seen tremendous rises in the prices of cryptocurrency. This is always the biggest factor when it comes to the rise of fraudulent activities. Since more people are looking to invest their money, scammers get even more active to take their money and run with it.
When awareness grows about the typical methods used by nefarious actors, they move to newer methods. One method that they have been using is impersonating celebrities. This makes the common person much more likely to become a victim. People seem to trust celebrities and let their guard down. As such, they click on links that they shouldn’t or send money to addresses that they think belong to those celebrities.
One such scammer tricked people out of $5 million in Dogecoin when Elon Musk’s SNL episode aired. They asked people to send some Dogecoin to their address and promised a share of a much larger reward pool (500,000,000 Dogecoins). It seems like many people fell prey to this scam and the fraudster got away with $5 million. Similarly, scammers have impersonated many other celebrities to trick people out of their money.
This is one of the biggest headaches of governments all over the world. There is a pressing need to protect people’s money from crypto scams and innovative regulations might be the only way to ensure that.