Reports and recent occurrences demonstrate that bitcoin frauds are increasing power in 2021
Cryptocurrency is rapidly gaining media interest in 2021 and so are crypto frauds. Cryptocurrency fraud attained an all-time high in 2021. Cryptocurrency money laundering is not a new phenomenon.. According to the CipherTrace research, crypto criminals have laundered US$432 million by the end of April. About 56 percent of the laundered cash was tied to DeFi.
Notably, this number has overtaken the entire of 2020 that had witnessed a loss of US$1.9 billion, and 2019 that struck a record of US$4.5 billion in cryptocurrency and bitcoin fraud losses.
A recent relevant instance of the bitcoin scam could be Elon Musk's impersonator who performed an embezzlement of $2 million. The theft was part of a bogus giveaway. Cons posing as celebrities promised to increase cryptocurrency deposits but grabbed the sums instead.
Another prominent incidence of a crypto fraud involves a British woman who lost all her assets at £9 000 (Rs 9,00,000 approximately) on bitcoin investment.
Five Other Indecipherable Cryptocurrency Scams
Before implementing safety steps to prevent cryptocurrency fraud, it is vital to understand the areas and components of crypto that are mostly tapped on by criminals and hackers. Analytics Insight has produced a crypto fraud list of five crypto frauds of 2021.
Defi Put Off the Stroke
DeFi stands for ‘decentralized finance’, an endeavor to refurbish and modify the existing trading procedures and structures. Decentralized finance allows users to stake their cryptocurrency in users and secure maximum revenues through interest.
While some reputable DeFi sites provide the best possible returns on money lent, others are outright scams. Such false platforms attract investors into lending money by promising high rewards but pocket the money the investors lend. Such schemes are so craftily handled that investors typically struggle to retrieve lost cash.
Non-Fungible Token Scams
Nonfungible Tokens and NFT are in popularity in the current times. NFT carries the risk of being replicated. It has special hashtag codes and the one who is in charge of the hashtag codes controls the power. There are recorded occasions wherein NFT hack recovery is difficult as deciphering hashtag codes is not a layman’s task.
Pumps and Dumps of Altcoin
Altcoin is typically classified as one of the cheapest and illiquid penny stocks with modest market capitalisation. The crypto pump and dump are features of penny stocks and Altcoin to join the flow. Altcoins, on the other hand, are very volatile and frequently fall into the hands of scammers and criminals.
Scams Caused by Viruses and Malware
New techniques and ingenious attempts to breach into an investor’s pocketbook might at times be annoying. To escape this overburden of new ways to conduct wallet breaches, hackers and criminals have reverted to age-old malware and viruses to obtain access to crypto wallets. Two-factor authentication can be a protective shield for crypto-wallets for this reason alone.
Fake ICOs
Fake Initial Coin Offering (ICO) is an issue that is still prominent and stresses out crypto investors. The year 2017 witnessed an increase in ICO fraud as the percentage of bogus ICOs exceeded 80 percent. Fortunately, the number had degraded in the following years. Fake ICOs continue to be a topic of worry to investors even today. Big Coin stole $6 million from customers.
