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April 18, 2022

Cryptocurrency is a popular topic of conversation, an investment endeavor, and can be a scammer’s playground.

What is Cryptocurrency?

Cryptocurrency is a digital currency that only exists electronically and is stored within a digital wallet. The digital wallet can be stored online, on a computer, or on an external hard drive.

With the popularity of cryptocurrency, scammers are capitalizing on this perfect opportunity to take advantage, to deceive, and to steal consumer’s money. Victims rarely discover the fraud scheme has occurred, before the scammers vanish with the cryptocurrency funds.

Cryptocurrency Scam Examples

Investment and business opportunity scams

Scammers promise a large return on the investment in a short amount of time. Scammers request that payment be made using cryptocurrency to “help grow your money/investment” or to pay for cryptocurrency fees. Scammers may create fake celebrity endorsements or testimonials to entice people to invest.

Social media scams

The Federal Trade Commission has stated, “if you see a tweet (or a text, email, or other message on social media) that tells you to pay with cryptocurrency, that’s a scam. In fact, anyone who tells you to pay by wire transfer, gift card, or cryptocurrency is a scammer.”

Romance scams

Scammers often find their victims on popular dating apps. Scammers first establish communication and the victim’s trust, then will request to move the conversation to another application such as “WhatsApp”. The conversation quickly changes to cryptocurrency.

Helpful Tips When Dealing with Cryptocurrency

  • Do research before investing and understand the risks of cryptocurrency.
  • Do research online for the name of the company and the cryptocurrency name. Use words such as “review”, “scam”, or “complaint”.
  • Do NOT invest in a virtual currency at the instruction of someone you do not know.
  • Do NOT share your “private keys”, the long letter-and-number codes that allow you to access your virtual currency, with anyone.