Cryptocurrencies, scam alarm: in 14 months damages for a bilion dollars

The study published by the US Federal Trade Commission on data from January 2021 to March 2022: 46 thousand reports made, but they would be only 5% of the total scams. 70% is about Bitcoin, then Tether and Ether

06 Jun 2022

Antonello Salerno

To give an estimate of the turnover of fraudsters who use cryptocurrencies to carry out their scams is the US Federal Trade Commission, the authority that overseas supervises competition and consumer protection. And the numbers are very respectable: in the 14 months between January 2021 and March 2022, according to the survey, "crypto-scams" would have been scored for a total amount of more than one billion dollars. The reports to the competent authorities would have been 46 thousand in the same period, but this would be an estimate by default, since only 5% of the victims, according to data released by  the FTC, report the theft suffered.

Index of topics

• Threats travel on social media

• Why hackers choose cryptocurrencies

• Investment scams and "Romance scam" at the top of the ranking

Threats travel on social media

Most of the scams, according to the FTC's analysis, to be precise 70%, would have concerned the most widespread cryptocurrency, Bitcoin. Then Tether with 10% and Ether with 9%. Moreover, 49% of the victims would have fallen into the trap set by crypto-hackers due to advertisements or messages conveyed by criminals through social media: in the order Instagram with 32%, Facebook with 26%, Whatsapp with 9% and Telegram with 7%.

Why hackers choose cryptocurrencies

"Cryptocurrencies have several characteristics that make them particularly congenial to the activity of fraudsters – explains FTC commenting on the analysis – and this helps to understand the fact that losses have multiplied by sixty, in the last year, compared to 2018. This is because there are no banks or central authorities that report suspicious transactions or that can intervene to stop fraud before it hits the mark.  Transfers in cryptocurrencies, moreover, can not be canceled: once the money has gone – explains the FTC – you can not go back. In addition, many people are still not familiar with how the world of cryptoassets works." But who are the victims who fall more into the traps scattered on the net by cryptocurrency criminals? These are mostly adults between 29 and 49 years of age.

Investment scams and "Romance scam" at the top of the ranking

As for the most successful types of scams, fake investments in new currencies are in the lead, which often turn out to be non-existent. More in detail, in the 14 months examined by the FTC, investment scams have collected a total of 575 million dollars of "booty", followed by the so-called "romance scam" (185 million dollars), the scams in which the bad guys make fun of the good faith of the victims by conquering and betraying their trust, perhaps through dating apps. The typical stratagem is that of those who after starting an online "relationship" begin to recommend investments and assist victims in making them, with an average loss of 10 thousand dollars for each unfortunate. Then the scams put in place by impostors who pretend to be companies, banks (93 million dollars), or institutions (40 million dollars).

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