The US Federal Trade Commission (FTC) has blamed the $1 billion loss through crypto scams on the feet of social media platforms such as Instagram, Facebook, WhatsApp and Telegram.
The report, released on Friday, found that the amount lost in 2021 was five times that of 2020 and six times that of 2018. The FTC described the relationship between social media and crypto as “a combustible combination for fraud”. Investment fraud accounted for $575 million of the $1 billion total.
According to the report, as of March 31, the amount of crypto defrauded was already half of the total amount of 2021. Between January and March 2022, more than 46,000 people reported being victims of cryptocurrency fraud, according to the FTC. .
There are reports of scammers posing as border patrol agents, businesses, government officials, and potential romantic interests.
The commission said: “The top cryptocurrencies people said they used to pay scammers were Bitcoin
“Crypto has several characteristics that attract scammers, which may help explain why reported losses in 2021 were almost sixty times what they were in 2018. There is no bank or other centralized authority to report suspicious transactions and try to stop the fraud before it does. arrived.”
“Crypto transfers cannot be undone – once the money is gone, there is no way to get it back. And most people still don’t know how crypto works.
“These considerations are not unique to crypto transactions, but they all play into the hands of scammers.”
“Reports indicate that social media and crypto are a combustible combination for fraud. Nearly half of people who said they lost crypto to a scam since 2021 said it started with an advertisement, post or message on a social media platform.
Currency, digital and crypto entrepreneur David Merino added, “The FTC is right. There are tons of threats against your money and scammers are constantly preying on potential victims. We created a high frequency trading algorithm partly for this exact reason. 30,000 people now use it because of its effectiveness, durability and transparency.
“We wanted to control the enormous risk in the forex market with a constantly profitable and audited system, safe for the investor and where the capital is always under the control of the person.”
On the fate of victims and the future of cryptocurrency with seemingly growing scams, he added:
“I spent 12 years in the military and struggled a lot financially. It’s sickening to me that people want to prey on the vulnerable through people with a lack of knowledge. Don’t just transfer your crypto. You are in control of your account. Be very careful where you transfer your money and before you think about why you are doing it.
“Social media is ultimately a means of communication that these people use. Increased and easy communication has its drawbacks in this sense. But in the end, the advantages of crypto, blockchain and web3 far outweigh the disadvantages. Fiat is constantly being scammed, we would never consider this a bad way of financing, but we need to secure our systems so that vulnerable people are better protected using crypto.
“I now have thirteen businesses and have certainly increased my success, there are opportunities there. But I can’t stress enough. Be careful.”
The FTC has detailed many ways to avoid crypto scams. Among the signs to look out for:
Only scammers will guarantee profits or big returns.
No cryptocurrency investment is ever guaranteed to make money, let alone a lot of money.
No one legitimate will ask you to buy cryptocurrency to solve a problem or to protect your money. It’s a scam.
Never mix online dating and investment advice. If a new love wants to show you how to invest in crypto or asks you to send him crypto, it’s a scam.
The report stated that people between the ages of 20 and 49 were the most likely to have fallen victim to a cryptocurrency scam.