Cryptocurrency: The 12 Most Common Scams Every Investor Needs to Know About

The Binance team published a statement warning about the 12 most common cryptocurrency scam methods today. “With the growth and adoption of the crypto ecosystem around the world, it is increasingly important to prioritize security,” they said.

Binance’s general manager for the northern zone of Latin America, Daniel Acosta, affirmed that “although it is true that the risk of falling victim to a fraudster is constant, illegal activities represent less than 1% of the volume of crypto transactions at a global level.” global, according to the latest Chainalysis report on cybercrime.”

investment scam

Investment scams are those in which a person or organization promises high returns if money is invested through a website, app, or cryptocurrency exchange.

Criminals can even claim to multiply your funds tenfold or more. The scam happens when you try to extract your profits or your capital.

employment scam

Is about Job offers that may seem authentic, with quite lucrative above-average salaries.

To detect the scam, it must be taken into account that sometimes pay a fee before starting work to secure your vacancy.

impersonate an authority

Scammers sometimes choose to impersonate and try to impersonate someone important. It can be an influencer, businessman, and sometimes a law enforcement officer.

The scam consists of asking the potential victim for money. When they pose as agents of a tax agency, they insist on the possible violation of the laws to force the payment of alleged fines.

Impersonate customer service

Scammers can pose as exchange customer support members. In the case of Binance, the platform warns that its employees they will never contact users to ask for sensitive information, such as login details or passwords (especially two-factor authentication codes).

Therefore, it is best to ignore calls or messages sent by supposed members of the services in which you operate when they try to request private information.

romance scams

Scammers create bonds with victims and when there is enough trust to apply for small loans or ask for support in the face of financial needbut the situation could escalate and involve large amounts of capital.

fake gift

Scammers often invite or add you to Telegram groups, Whatsapp or Discord channels to participate in fake cryptocurrency giveaways.

The scam is that they choose you as a winner, and that to deliver their prize they ask to reveal sensitive information.

Ponzi scheme

Ponzi (or pyramid) schemes are a type of scam that uses funds from new members to pay old ones. When not so much flow of money comes in, problems begin to become evident, such as the difficulty in extracting profits until the “company” is closed for reasons that may vary depending on the case.

Fake shopping sites

They are sites that mimic a legitimate e-commerce website, even going so far as to allow users to register as merchants or customers. The key here is that they could offer products and services at a much lower cost than the market average, but in the end they will never deliver what was agreed.

Money transfer fraud

This type of fraud can occur in different scenarios:

• Commercial operations between people (P2P):When people trade cryptocurrencies online, there is often an exercise in trust, as the buyer usually has to deposit the money first, and then the seller has to deliver what has been agreed according to established guidelines. Here it can happen that the seller does not deliver the agreed goods, or that the buyer seeks to cancel the bank transfer once he receives the assets from him.

• The other scenario involves the buyer using false receipts to affirm that you made the corresponding bank transaction, and and then demand the sending of the cryptocurrencies.

In these cases, the important thing is to operate through P2P platforms with a good commercial reputation, and choose duly verified merchants to carry out your transactions. The service will keep the cryptocurrencies in custody while the respective payment is made, so you must verify that the funds have arrived in your account before releasing the cryptoactives. If not, open a dispute request and collect evidence of the inconsistencies in the operation to properly inform the customer service area.

acquaintance fraud

It can also happen that the scammer could be a relative, close friend or an acquaintancewhoever makes any of the aforementioned proposals under the premise that they will be able to derive significant profits.

carpet pulls

Also known as Rug Pull, this type of scam is very common within the cryptocurrency ecosystem. It basically consists of A crypto project team raises money from investors, then they suddenly abandon the initiative, taking all the accumulated capital with them.

Others

This category is reserved for unique cases where a scam is taking place, but the circumstances do not match any of our existing categories listed above.