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Over £140 million lost to cryptocurrency scams in 2021 alone!

Over £140 million lost to cryptocurrency scams in 2021 alone!
Image source: Getty Images


You probably already know that the world of cryptocurrency can be a dangerous place. But new figures show the extent of the damage to people in the UK, and they’re not very flattering numbers.

Here’s what’s been going on with cryptocurrency scams and how you can protect yourself from getting stung.

How much has been lost to cryptocurrency scams?

It’s been a busy nine months for Action Fraud, the national reporting centre for cybercrime, which has received over 7,000 reports of cryptocurrency fraud.

According to data released to Bloomberg by UK police, over £140 million has been lost to cryptocurrency scams. And that’s just this year alone!

This amount is already 30% more than the total cryptocurrency fraud losses in 2020. It’s not just helpless elderly folks falling victim to scammers either. Over half the victims were aged between 18 and 45.

How does cryptocurrency fraud work?

Currently, one of the most popular scams is leveraging the power of celebrity. If I told you I’m actually George Clooney and I can make you rich with cryptocurrency, you’d easily catch me out.

But some of these fraudsters are really clever. They will sometimes pay real celebrities to endorse bogus cryptocurrencies, or they might create fake celebrity accounts and deceive people into believing they’re the real deal.

Everything is digital and you can never be truly sure who’s behind the phone or laptop at the other end. There was even a scam last year where high-profile Twitter accounts were hacked, followed by tweets saying any Bitcoin sent will be returned double. It may sound daft, but it was coming from legitimate places like the official Apple account.

There are plenty of different ways fraudsters will attempt to trick you. This doesn’t mean you have to be paranoid, but it’s important to be vigilant and protect yourself.

What can you do to prevent cryptocurrency scams?

It’s important that you understand the different risks that can be involved with cryptocurrency.

Once you have a decent grasp of the dangers, here are some ways to best defend yourself against potential problems:

  1. Make sure you buy cryptocurrency using a secure exchange.
  2. Consider using some form of wallet for storing your cryptocurrency.
  3. Don’t send or reveal details about your wallet and cryptocurrency.
  4. If someone advertises a cryptocurrency ‘giveaway’ be wary.
  5. Remember that if something sounds too good to be true, it probably is.

Takeaway

Not all cryptocurrency opportunities are scams, but it’s an area that you really need to be careful with.

There’s a lot that can go wrong just managing your own coins and wallets. Throwing scammers into the mix can make things even sketchier.

Do what you can to protect your assets, and if someone is offering free cryptocurrency as an incentive or a celebrity influencer is endorsing a project that seems attractive, take extra care. Don’t become another one of the many people who’ve already lost money this year.

Investing in Cryptocurrency is extremely high risk and complex. The Motley Fool has provided this article for the sole purpose of education and not to help you decide whether or not to invest in Cryptocurrency. Should you decide to invest in Cryptocurrency or in any other investment, you should always obtain appropriate financial advice and only invest what you can afford to lose.

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