Whether one likes it or not, crypto currency is the future. It is already having a huge impact on the world around us. With the adaptability of block chain-based technology, cryptos are slowly but steadily making their presence felt around us.
Many are attracted to its simplicity and volatile nature, while at the same time offering anonymity and a chance to make substantial profits. In recent years, the adoption rate has increased very rapidly.
Cryptos not only allow for lower transaction fees while transferring cryptos from one account to another but also facilitate such transactions faster compared to traditional financial institutions like banks.
However, as everything has a price to pay, cryptos have become the main attraction for scammers and hackers globally. The idea of ripping off someone without leaving one’s home is an ideal scenario for many scammers and hackers, and that too on a computer.
Although it is not difficult to track down stolen cryptos, it does require huge human resources and technology. Unfortunately, a common Crypto scams user may not have access to it. Thus, scammers and hackers are well aware of this fact, which is why they successfully get away with their loot.
If you wish to invest and trade in cryptos, then this article should help you spot red flags for a potential scam or fraudulent activity.
Use of social media platforms
We live in a world that connects us with others through various social media apps like Instagram, Meta, Twitter, Telegram, Reedit, TikTok, and so forth. Someone from Australia can connect to someone in the United States through these apps. These apps have brought us closer to each other.
Nonetheless, it has also helped scammers carry out their devious schemes to rip off unsuspecting victims. As we’ve previously indicated, scammers operate from the comfort of their own homes.
Scammers will create fake profiles to entice their victims into Crypto currency scams and then run away with all the money that they have collected.
We will mention a few of the most prominent scams that these scammers pull and red flags to watch out for.
Airdrops
It is quite convenient for crypto developers or other block chain-based firms to promote their products by airdropping cryptos. Such a move causes a sensation, and many rush to get their hands on it. Such moves are common and legal.
Scammers understand this logic and exploit it to the fullest. They will impersonate celebrities and announce that those who give them a few cryptos will then receive “X” amount of cryptos. Many rush at these enticing proposals to make a few bucks. Unfortunately, scammers are in control of the entire operation, and once they have “freely” received it, they will run away with it, scamming many in their wake.
As a reward for those crypto users who aided them through cryptos to fight off the Russian war machines during the initial stages of the invasion of Ukraine, they announced that they would reward them through airdrops. Unfortunately, many scammers opened up a duplicate website where the donor had to type in their crypto account and wallet address in return for crypto tokens.
Red flags
Always check for the authenticity of the celebrity or social influencer offering airdrops; there are high chances of them being scammers.
When someone asks for details other than those necessary to receive airdrops, it is wise to step away and not dwell in fear of missing out.
Verify and authenticate the website to avoid giving away free cryptos to scammers.
Charity and donations
Many reputed charity organizations are available online that accept donations for humanitarian causes. They may range from raising funds to donating to the victims involved in natural or artificial calamities. They may even raise funds for upbringing and education on behalf of organizations raising orphans.
In February 2022, when the Russians first invaded Ukraine, the Ukrainians lacked the necessary equipment to fight the Russians. The Ukrainian government started to accept cryptos as aid. However, several scammers created a fake Ukrainian government website and took free cryptos before they were discovered.
Red flags
Regardless of whether you want to donate to a global cause or someone down the street, verify and authenticate that they are working for humanitarian reasons and not some scam.
If possible, try to donate your funds directly to the need; if not, verify the link provided in the text, message, email, or any other social media platform.
Romance scam
Everyone loves the idea of falling in love and is ready to do things that one can only imagine. As the saying goes, it’s never too late to fall in love, and it is the same emotion that victimizes them, allowing their scammers to take complete control over them.
As always, scammers will create fake profiles to entice their victims on dating apps, and once they either approach or get approached, the real emotional manipulation game begins.
At first, they will initiate romantic talks and try to gain as much information about their victim as possible. These scammers will impersonate someone successful and contribute their lives to humanitarian causes.
Once they successfully gain the complete trust of their victims, they will ask to send cryptos for unforeseeable reasons; these may vary from being hospitalized due to life-threatening complications to being held as a hostage. And the only person who will save them from these perils is the victim whom the scammers have enticed.
The charade continues until the victim realizes that they have been scammed or someone close to them states the blatant truth.
Red flags
When you meet someone who shows interest in you, be cautious. Be even more cautious if they are a flight or two away from you.
When you desire to meet them but they try to avoid you for some reason, not once but every time you offer to meet them
They say that they love you very quickly and share common interests.
They will offer you financial advice and tell you to invest in a particular crypto before they ask you to send all your cryptos for safekeeping due to some legal matters.
They will decline to talk on video due to some technical reasons.
Last but not least, they will request that you keep your relationship a secret from everyone again for some unforeseeable reasons.
Financial advisors
Everyone wants to make money because that is what is required to pay our daily bills. With extra money, you can splurge on yourself and get the things that you desire. With extra money, you can shop to your heart’s content.
These so-called financial advisors, aka scammers, who impersonate them will promote their fake financial schemes. These schemes are usually too good to be true, with minimal risk and high returns guaranteed. They are usually either a Ponzi scheme or a pyramid scheme.
With the popularity of cryptos surging, scammers are involving cryptos to collect funds from their victims.
In recent years, many have seen all-time highs in cryptos and are getting attracted to them. The fear of missing out, or FOMO emotion, is so strong that these scammers are capitalizing on it. They are asking their victims to invest in cryptos, and those who invest only need to count how much money they will get after investing in the scheme.
In a Ponzi scheme, new customers’ investments are used to pay off the older investors. The scheme continues as long as there is steady recruitment of new investors. Once the supply stops, there is no free money to move around, and the entire operation winds up with scammers running away with a substantial amount of money.
A pyramid scheme is similar to a Ponzi scheme but differs in the way it operates. In a Ponzi scheme, old inventors are not encouraged with bonuses as they bring in new investors. And this is the only way a pyramid scam works.
Red flags
Scammers will usually tell you how much money you will make as per your investment and as per bonuses assured to bring in new investors. They will refrain from indulging in how the business model works.
Scammers will also make heavy use of technical words to portray a fake image of a financial guru and sound financially savvy.
If someone approaches you promising a huge opportunity to make money, tell them that they want the entire working model and all the terms and conditions in writing. If you find it challenging to understand the language used, then approach a local certified public accountant, or CPA.
Internet celebrities are jumping on the bandwagon.
Social media influencers are flooding online applications with multiple accounts and fan bases on various social media platforms. They are having such an effect on their fans that most social media influencers will rip them off without losing any fans.
In recent years, many internet celebrities have pulled a lot of Crypto currency scams to make quick money at the expense of their fans. They will rug-pull, or even pump and dump, their fan base to make a substantial amount of money.
Several internet celebrities will initially choose a single crypto currency and buy it when the price is low. They will then go on the social media platform and promote the same crypto they have invested in.
Following their financial advice, many invest in it, and following the law of supply and demand, the price of the crypto will start to surge. After the price of crypto reaches its peak, these internet celebrities will sell off their crypto holdings, leaving their fans with worthless coins or tokens.
Red flags
If they say that they have an insider trader or that they know some crypto developer who is creating a new crypto that will make you rich by investing in it, stay away from them.
Any insider trade is illegal; they are only faking it by suggesting you buy the crypto they are interested in seeing surge to a new level and then selling it, leaving you with worthless cryptos.
Anyone without a certificate in finance or accounting giving financial advice should be taken with a grain of salt. You are better off listening to their financial advice alone and staying clear of any investments they make.
Final thought
Although technology has enhanced our lives, it has also created a lot of problems. Scammers, hackers, and a few social media influencers are taking undue advantage of their victims.
Even though crypto currency is the future and many are looking forward to it, scammers, hackers, and a few internet celebrities are undermining it by forcing the government to take stringent actions against its use.
Author bio
The author has been an avid computer gamer since his childhood. In his / her 20s, when he /she came across crypto-based games, he/she was reluctant at first, but the prospect of earning money fascinated him/ her.