Dutch Student Arrested for Alleged €4.5 Million Crypto Scam
A 24-year-old law student from Hengelo, Netherlands, has been arrested for allegedly running a crypto scam that defrauded around 300 people of €4.5 million ($4.6 million). The arrest followed new evidence submitted by a victims' group.
Crypto Scams Rising in the Bull Market
The student had been in hiding since his trading scheme collapsed last year. Initially, he sought police protection due to harassment from angry investors and was moved to a secure location. However, investigators later accused him of continuing to recruit new investors even as his scheme was failing.
Victims claim the student operated a Ponzi scheme, using new investors’ money to pay earlier ones. He reportedly required a minimum investment of €5,000 and kept 50% of profits as his fee. Legal experts are alarmed by the size of the alleged scam, which is still under investigation.
Crypto Frauds Surge in 2024
Crypto scams and hacks caused $2.3 billion in losses in 2024, up 40% from the previous year. The bull market has attracted many new investors, making them prime targets for scammers.
Recent scams include:
Fraudulent tokens linked to Netflix’s Squid Game second season, flagged by blockchain security firm PeckShield.
Phishing attacks during the holidays targeting users of Ledger hardware wallets, attempting to steal recovery phrases.
Social media hacks on X (formerly Twitter), promoting fake crypto tokens.
Additionally, AI-driven scams have surged. Hong Kong authorities recently arrested 27 suspects involved in a deepfake romance scam that defrauded victims of $46 million.
These incidents highlight the urgent need for stronger security measures in the crypto industry.