Digital Currencies have revolutionized how the world views transactions. Along with that view, cryptocurrencies have also brought about some grand scams and fraud over the past few years. The success of the most popular cryptocurrency, Bitcoin, and other altcoins, have boosted an industry which incorporates blockchain technology in a number of creative ways.
Many smart and innovative minds are using the power of cryptocurrencies and blockchain technology to create game-changing companies within the industry. That said, sinister minds have also jumped into the crypto space, tricking oblivious investors in sophisticated scams. There are over 1,200 different cryptocurrencies available on the net, and a lot of digital currency exchanges basically operate online without regulation. This has made it quite difficult to know who’s exchanging, selling, buying or offering cryptocurrency. It also means that in a situation whereby things go south, getting back your money is not feasible.
In South Korea, the largest cryptocurrency exchange, “UPbit,” was raided by prosecutors in May. Cases of potential fraud lead to a search of the head of the exchange. The news of the crypto fraud came just as South Korean authorities have been carrying out a series of investigations on digital currency exchanges regarding regulatory measures.
Recently, an ICO scam grabbed major headlines. “Pincoin,” built on blockchain technology, was run by a Vietnamese company believed to have scammed about thirty-two thousand investors of $660 million. The company promised to give investors 40% of returns monthly on any investments.
Over 25,000 people in South Africa have fallen victim to cryptocurrency fraud. In May, the South African Police Service started investigations into an alleged crypto investment fraud. The scam, which affected thousands, resulted in losses over 1 billion rand, which is equivalent to $80.4 million USD. BitCaw Trading Company, popularly known as BTC Global, encouraged members of the public to invest in Bitcoin with promises of receiving a certain percentage of interest daily.
To raise awareness on numerous cryptocurrency investment ricks, Belgian authorities launched a website on June 5th. The announcement came publicly from the FPS Economy. The website creation came as a result of $2.5 million in losses suffered by Belgian investors in cryptocurrency scams. The website educates potential cryptocurrency investors to carefully check details of any project before investing. It also cautions investors when completing digit currency transactions online.
As cryptocurrency fraud increases, fraudsters will go to any extent to trick oblivious investors. There is a need for investors to take extreme care when it comes to making cryptocurrency investment decisions.