It’s probably not news to anyone that there are billions of dollars tied up in cryptocurrency. Within ten short years, the value of a single bitcoin has shot up to more than $50,000—and there are almost 19 million in circulation. While Bitcoin is the elder statesman of this type of popularly accepted virtual currency, it certainly isn’t the only one.
Those who don’t follow the cryptocurrency market may have only heard about Bitcoin, Ethereum, and maybe Dogecoin, but there are thousands of different coins that can be bought and traded using online exchanges. Advertised as a decentralized alternative to traditional fiat currency, governments around the world have generally given crypto the side eye—and part of that unease comes from the relative anonymity it provides for online transactions.
The promise of anonymity has predictably attracted diverse groups to cryptocurrency, from personal freedom crusaders to the seedier element of society. Ransomware attacks generally demand payment in crypto as a result of that anonymity; now that it’s gaining widespread acceptance, the Federal Trade Commission warns that criminals are starting to send crypto-themed phishing scams.
What are the latest cryptocurrency scams?
Where there’s public interest, you’ll generally find identity thieves and scammers. To help you know what to look for in your inbox, the FTC divides recent cryptocurrency scams into three categories:
- Investment and business opportunity scams
- Blackmail emails
- Social media scams
Investment and business opportunity scams aren’t new to cryptocurrency, but the market is getting a lot of press due to record highs and famous investors touting it on social media. According to the FTC, these scams range from “investment managers” offering to help you make a dump truck full of money to fake crypto-related job offers.
Even more insidious, the FTC says criminals occasionally post their fake job offers on legitimate job-search websites: “They’ll promise you a job (for a fee), but end up taking your money or personal information.” At a time when millions of Americans are out of work, that means the unemployed need to be extra careful during their job hunt.
The FTC compiled a list of common signs that these investment and job offers are bogus:
- Scammers guarantee that you’ll make money. If they promise you’ll make a profit, that’s a scam. Even if there’s a celebrity endorsement or testimonials. (Those are easily faked.)
- Scammers promise big payouts with guaranteed returns. Nobody can guarantee a set return, say, double your money. Much less in a short time.
- Scammers promise free money. They’ll promise it in cash or cryptocurrency, but free money promises are always fake.
- Scammers make big claims without details or explanations. Smart business people want to understand how their investment works, and where their money is going. And good investment advisors want to share that information.
The FTC also recommends flexing your Google muscles before diving into any investment or answering a job listing.
“Research online for the name of the company and the cryptocurrency name, plus words like ‘review,’ ‘scam,’ or ‘complaint,’” the agency says. “See what others are saying. And read more about other common investment scams.”
Next up are blackmail emails and social media scams, which are two sides of the same coin. Both want payment in cryptocurrency, but they go about it in different ways.
Blackmail scams rely on fear, demand cryptocurrency often claim to “have embarrassing or compromising photos, videos, or personal information about you.” These extortionists know that it’s difficult—and in some cases impossible—for crypto payments to be reversed, which is why they prefer it. Instead of giving in to the demand, the FTC says you should “report it to the FBI.”
Social media scams, on the other hand, try to weaponize trust. These crypto-payment requests appear to come from someone you personally know or a celebrity. Whatever the case, the FTC says you should ignore the “tweet, text, email, or … [social media private] message” and report it at ReportFraud.FTC.gov. Remember, even if it’s someone you trust, the sender account could be compromised.
Today, we focused on cryptocurrency phishing scams, but the original FTC blog also includes a lot of helpful information about cryptocurrency in general. Be sure to check it out in the link below.
Source: “What To Know About Cryptocurrency and Scams,” FTC.gov