Crypto scams are up this year. Here’s what to look out for

Amidst the ongoing economic turmoil reverberating from the COVID-19 pandemic and geopolitical conflict, scams have been trying to part people from their hard-earned money at a time when they can least afford to lose it. The crypto space, being international and only loosely regulated, is a current target of scammers, and all users, traders, and investors should stay informed of best practices and use only verified platforms.

A recent article titled Top-10 Ways to Spot a Crypto Scam is making waves on the net. The guide was released by the Australian Securities and Investment Commission (ASIC), an Australian regulator, and is intended as a public advisory document to highlight crypto scams during Scams Awareness Week 2022, a government initiative to inform its citizens about all kinds of cons.

According to ASIC, “investment scams” are on the rise in 2022, with cryptocurrencies becoming a significant part of this classic group of scams. The regulator identified three distinct categories of cryptocurrency scams:

1. Investment scams claiming to offer opportunities to invest in a legitimate digital asset, but the exchange platform (app or website) turns out to be fake.
2. Money laundering with fake crypto tokens.
3. Using cryptocurrency to make fraudulent transactions.

With regard to the first point, scammers will often pressure their victims to send crypto to their websites. We’d like to remind all crypto traders and investors to never use apps that aren’t listed on the iOS App Store or Google Play! StormGain and other reputable crypto exchanges are verified by the storefronts, which work to keep scammers off their listings.

Top ten signs of a crypto scam

The actual list of warning signs of crypto scams published by ASIC contains many useful things to watch out for and is worth repeating for anyone involved in crypto and finance in general. These signs include the following:

1. You receive an offer out of the blue
2. You see a celebrity advertisement that is actually a fake
3. A romantic partner you only know online asks for a money transfer in crypto
4. You get pressured into moving crypto from your usual exchange to another website
5. You’re asked to pay for a financial service with crypto
6. It directs you to an app not listed on Google Play or the App Store
7. You need to pay more to access your money
8. The offer guarantees investment returns or free money
9. Strange tokens appear in your digital wallet
10. The provider withholds investment earnings ‘for tax purposes’

ASIC goes on to advise people to always contact their bank or financial institution if they believe they have been victims of a scam, as well as to warn family and friends to spread awareness of the danger.

Trade crypto safely

The advice distributed as part of Australia’s scam awareness week is relevant for people in all countries and at all times of the year. We’d like to add, in the spirit of these tips, to also beware of suspiciously-named cryptocurrencies and NFTs suddenly popping up around trending events, such as we have seen twice very recently in conjunction with the passing of Queen Elizabeth II and Elon Musk’s Twitter acquisition. Such tokens are usually a scheme designed to attract attention to junk tokens with no value.

At StormGain, we provide a fast, reliable, and secure platform for trading and investing in crypto. Available on Google Play and Apple’s App Store, the StormGain app offers a selection of 50+ digital assets, selected for quality out of the many thousands of crypto tokens on the market. The StormGain app comes with built-in trading signals, wallets with interest for savings, and even an educational resource bank, with explainers and webinars that help users understand crypto terminology and market behaviour. Our dedicated customer support team is also always there to assist users with technical issues.

And what’s really important to add during these days is that StomGain continues serving its valued customers as usual. No matter what turmoil the market may see, let StormGain be your safe haven! Sign up and try a free demo account to see what it can do for you!