Identifying the Top Three Most Common Cryptocurrency Scams

With cryptocurrency valuation at an all-time high, you best believe that there are bad people out there who want to steal your hard-earned digital assets. While we want to believe that all men (and women!) are good, there are always dark souls out there who would invest in complex scams for their own selfish gains. This article focuses on how you can identify the most common scams in the crypto industry. Note that even though there are scams that are unique to cryptocurrency, most of the crypto scams are entwined with already existing financial scams. Let us take a look at the most common crypto scams and how to avoid them.

 3 Most Common Crypto Scams:

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  1. Investment Scams

Do you know the saying: “It’s too good to be true?” If the financial opportunity you are seeing is, chances are that it truly is, and you should run the other way. Investment scams are one of the most notorious scams globally. If someone approaches you and wants you to invest in the Next Big Thing and claim that you will instantly get rich, this is the not-so-humble beginning of an investment scam. 

Even though a person would introduce themselves as an “investment manager,” it would be best to only transact with credible financial institutions. Their usual strategy is that they will grow your crypto assets, but in actuality, your crypto assets are now frozen until you pay them for a fee. 

Other investment scams in the crypto industry look like pyramid scams. The scammer will influence you to pay them in crypto so they can recruit other people, claiming that you will earn more money if they get more people in the business and then suddenly vanish.

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  1. Phishing Scams

Phishing scams operate in a way where they want to get into your bank details. Phishing scams in the crypto world operate similarly – the only difference is they want to get into your crypto wallet. These scams are also known as “technical support scams” because scammers would often disguise themselves as tech support to get your credentials. These scammers will often provide help and ask for your crypto log-in credentials. They might also ask for information so they can remote your computer or ask you to send your digital assets to a suspicious wallet. The rule of thumb is to never give your login credentials or crypto password to anyone.

  1. Giveaway Scam

Pop culture enabled the crypto giveaway scam because celebrities and influencers often promote certain cryptocurrencies (yes, we are looking at you, Dogecoin). With this, scammers would organize giveaway activities, often claiming that these giveaways come from famous celebrities. They even create dummy accounts so these dummy accounts can respond and hype up the post. The posts would often give you links or QR codes you need to pay to enter. Again, suppose you need to pay for anything to claim a giveaway. In that case, this is a scam, and you better run in the opposite direction.