Dangers of Crypto currency Frauds and Strategies to Safeguard Oneself

As more and more people try to adopt crypto currencies and begin to invest and trade in the crypto market, most get duped due to a poor understanding of the workings and a lack of awareness of the crypto market. Scammers entice these poor crypto users into elaborate crypto currency scams.

In recent years, the popularity of crypto currencies has grown due to their apparent advantages. Some also invest and trade in cryptos to hedge the global inflation that has gripped us all.

Thus, it is only natural to get hold of these elusive cryptos when the crypto market is just right and make substantial profits when the opportunity arises. Cryptos are volatile and follow different sets of laws compared to the laws of the economy that we are quite aware of.

All said and done, the crypto market does follow only one rule of the economy, which is the supply and demand law. It can be quite challenging for those to trade in the crypto market without understanding the price fluctuation of cryptos. 

Due to a lack of necessary awareness and understanding, many people lose their financial holdings due to uninformed decisions. Many also fall victim to scammers as they lack the necessary skills to manage their monetary funds.

How Do Scammers Trap Their Victims?

It is a sad truth that even the most educated individual lacks the necessary skills and awareness to manage their financial funds efficiently and effectively. Such skills that can help guide us to the betterment and achieve the ideal lifestyle that we all aspire for are not taught in our educational system.

Scammers are well aware of such situations, and they will use this disadvantage to their advantage. We will explore the innovative ways that these scammers employ to scam their victims.

How Does A Scam Work?

It is quite easy to spot a scammer. There are a few things that you need to be aware of before you sign up for those attractive and lucrative investment opportunities.

As mentioned, the general population does not know how the monetary system works, and the crypto market is no exception. At the end of the day, it is just another financial asset that differs from fiat currency in nature; it is a digital asset. And we need to admit that we lack the necessary skills and awareness to manage our finances.

Financial Advisor

Many times, scammers will impersonate a financial advisor who will only try to benefit from you through their investment schemes. They will bombard their victims with heavy financial jargon to appear as financial advisors who are well-versed in their trade.

It is only natural that we fall for such gags, as we trust their fake abilities and the fake knowledge they use to entice us. Thus, unknowingly, we hand over our financial holdings to their care and protection, only to be scammed at the end of the day.

If you come across crypto investment opportunities, you can spot a scammer based on these factors.

  • They use heavy financial jargon without explaining it to you.
  • The investment scheme they suggest stresses the amount of money you will make instead of how the investment scheme works in detail.
  • They give you little or no time to think over or discuss the investment scheme with your near and dear ones.
  • They will suggest taking the money out of your emergency funds or retirement funds with a fake promise.
  • Their website is full of grammatical and punctuation errors.
  • They offer bonuses for referrals.
  • They offer unrealistic returns on investments.
  • They have verified insider trading tips.
  • They recommend certain obscure crypto currencies that you have never heard of.

Recently, there has been an explosion in the number of scammers on social media platforms. These scammers have a huge and wide audience and fan base. These scammers are not well-versed in finance and resort to crypto currency scams to make money.

These scammers blatantly lie to their audience and entice them with pump-and-dump and rug-pull schemes. At the end of the day, these scammers make a ton of money at the expense of their audience and fan base.

Romantic Encounter

What can be worse than losing your hard-earned cryptos to scammers? Losing your heart too. Scammers, under the guise of potential partners in search of romance, will target those on dating apps, social media, and messaging platforms.

Once they have established total control over their victims, they will try to make money by emotionally blackmailing them. These scammers will create fake accounts to entice their victims. These scammers will make fake accounts while impersonating someone who is highly regarded in society and easy to fall in love with. 

They take the guise of:

  • Military personnel deployed overseas for active duty
  • A medical representative working in a third-world country for a humanitarian cause
  • A young, dynamic, and successful entrepreneur or businessperson who did not find time for love

So the question arises: how do these scammers entice their victims?

  • They “fatten” their victims with tons of compliments.
  • They manipulate their victims by making them think that, all this time, nobody has given them the attention and validation that they are truly entitled to.
  • They quickly fall in love with their victims and propose to marry them soon.

After creating a false persona, these scammers will then make their victims desperate.

  • Scammers will call their victims when they want to.
  • They avoid making a video call due to poor reception.
  • They will cancel their plans to meet victims physically due to lame excuses that might make the victims think that they are genuine excuses.


After gaining the trust and confidence of the victim, these scammers will milk their cryptos to such an extent that they will end up demanding cryptos at the expense of these victims. 

These scammers employ nefarious methods through

  • Offering financial assistance through investment schemes
  • Frequently require money for their daily survival.
  • End up in a hospital and are plagued by an unknown disease or life-threatening accident that requires a lot of money for their alleged medical treatments.
  • As agreed, the shipment is sent but is held at various checkpoints, demanding more and more money.
  • Taken hostage by a local gang or warlord and demanding a huge amount of money
  • They want to be in arms with the victim but need to bribe their higher authorities for release from their contract.

Extortion and Blackmail

Scammers also resort to extortion or blackmail to milk cryptos from their victims. In an extortion crypto currency scam, scammers will ensure that victims download software that will lock the electronic device on which they have downloaded. Once they take total control of these electronic devices, scammers will demand cryptos from their victims in return for giving back control of the electronic device that they have kept as a hostage.

While blackmailing their victims, these scammers will indulge their victims in a compromise position and will demand cryptos if they do not want these videos on the social media platform for public viewing. Such scams also fall under romance scams.

Final Thoughts

Although you will find several categories of crypto currency scams, the final intention of these scammers is to make a lot of money through cryptos. However, at the end of the day, no matter what the scam is or how it was perpetrated, scammers are known to act through the above-mentioned methods to scam their victims.

You must be aware of the breadcrumbs being laid by someone you have never met in life. Avoid sharing details with someone whom you have never personally mentioned in your life.

Try to reason out why someone you have never met offers financial assistance. It should also raise red flags when someone suggests that you take money from emergency funds, like college funds, mortgage funds, or any other funds. You should be cautious if someone suggests that you take money out of your retirement funds.

Any financial advice or opportunity that you might find of interest should be discussed with the ones you trust. If you don’t find anyone, then before you sign those documents, get those terms and conditions verified and authenticated by a local certified public accountant.