How to Avoid Being a Victim of a Crypto Scam

More than one-third of cryptocurrency victims report a scam. The age group of 20-49 years old reported the most fraud losses, with 35% of people in this age bracket reporting losses. The most common age group for individual losses was those in their 70s. However, anyone can become the victim of a cryptocurrency scam, and the best way to protect yourself is to educate yourself and avoid falling victim to one.

Social media

Despite cryptocurrencies’ popularity, scammers have not shied away from social media. In fact, nearly half of people who lost money to crypto scams said the scam began with a social media platform. Among the top platforms, scammers used Facebook, Instagram, WhatsApp, and Telegram to find their victims. However, it is important to remember that the number of scams involving these platforms is growing, and you should be vigilant about your personal information and funds.

Unregulated virtual currency landscape

While many consumers have benefited from the benefits of decentralized finance, some are concerned about the lack of regulation. This is especially true with the introduction of peer-to-peer lending and other crypto assets. The total value of these assets allocated to decentralized finance increased from under $1 billion to more than $15 billion from December 31, 2019 to December 31, 2020, according to the FTC. While these are relatively small amounts, they could easily cost consumers billions of dollars.

Easy to track

In a recent report, the Federal Trade Commission found that over $46,000 people lost more than $1 billion in cryptocurrency scams in 2021. However, these numbers are likely understated as the total number of people who lost money is likely much higher. This article explores the best ways to track the losses and prevent becoming a victim. Listed below are some tips to help you avoid being a victim of cryptocurrency scams.

Romance scams

The FTC has released a list of ways to avoid falling victim to romance scams. The top three methods are to use a reload or gift card, cryptocurrency, and bank transfer or payment. Among all of these methods, gift cards and reload cards were the most common way to pay in 2021. However, there are exceptions. For example, Western Union and MoneyGram are not included in the list because they report each individual transaction, which may increase the number of romance scams that have been reported.

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