The notion around cryptocurrency frauds is that they are tailored to dupe green and inexperienced investors. However, the threat actors have become more sophisticated, and they are planning a massive heist that is impossible to intercept at first glance, even for professional traders and longtime investors. According to a new report published by Financial Trade Commission (FTC), between 2020 and 2021, more than 7000 United States citizens have lost an average of $1,900 on crypto scams.
On the whole, that makes up for about $80 million loss write-offs in total. In the same fashion, the Australian Competition and Consumer Commission has recently published a report claiming that regional investors lost about $26.5 million in lieu of cryptocurrency scams. According to the American regulatory agency, the amount of crypto-based scams has increased about 1000% since last year as the threat actors are getting smarter.
According to the latest reports, scammers are taking advantage of the abandoned crypto projects like tokens and exchange platforms to target new victims. Such a case was intercepted when scammers revived a dysfunctional digital asset LUB token. The defunct token was introduced to new investors with a press release and a new scam website. The altcoin offers as much as a 10% return on investment.
Such cases are visible all around the world. An out-of-commission crypto exchange platform based in Korea called BitKirK has opened up once again. However, when the investors tried to get access to their funds, the scammer ran away and folded the operations. Another such case can be witnessed in the matter of Stefan Qin, who was found to be guilty of running a scam crypto hedge fund. Qin managed to rack in about $90 million from his con attempts.
Law Enforcement Agencies Claim that Investors should always Look for Proper Financial Audits before Investing in any New Project
According to the major law enforcement agencies and expert legislators, these new types of scams are capable of fooling even the most trained eyes. Therefore, the investors should look for the financial audit reports for the crypto enterprises and projects they are interested in. In this manner, it would become possible for the investors to ascertain the legitimacy of the new business without having to worry about getting scammed.
Other than direct scams, the threat actors are also pointing their guns at the DeFi space. The DeFi space is where the largest money pool of the investment is stored. The major hacks on altcoin and blockchain projects to date have dominantly targeted the decentralized projects.