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Major Cryptocurrency Scams to Watch Out For
The cryptocurrency market, despite its potential for high returns, has also been plagued by numerous scams. Fraudsters continuously devise new methods to deceive investors. Here’s a most significant scams in the crypto world:
FTX: The exchange collapsed in November 2022 after mishandling billions in customer funds. Founder Sam Bankman-Fried was sentenced to 25 years for fraud.
Luna and TerraUSD: These cryptocurrencies suffered a catastrophic $60 billion loss in May 2022, leading to the arrest of founder Do Kwon in March 2023.
QuadrigaCX: Following founder Gerald Cotten's death in 2018, $215 million became inaccessible. It was later uncovered as a Ponzi scheme.
Africrypt: In 2021, investors were scammed out of 70,000 BTC. Founders Ameer and Raees Cajee are now being investigated for money laundering.
SafeMoon: Executives withdrew over $200 million for personal use in 2021, resulting in SEC fraud charges.
Other notable scams include:
Pro-deum: This was an exit scam in 2018, leaving investors with nothing after the team disappeared.
Pincoin and iFan: Modern Tech raised $660 million in 2018 through ICOs, only to vanish, marking it as another Ponzi scheme.
Celsius Network: This platform paused withdrawals in 2022 and filed for bankruptcy, owing $4.7 billion. They are now working to return assets to customers.
Centra Tech: Raised $25 million in 2017 on false promises, leading to the founders' imprisonment.
Mining Max: Defrauded investors of $250 million in 2017, with only a fraction used for actual mining, affecting 18,000 investors.
To protect yourself from such scams, always conduct thorough research, verify the team's credentials, be wary of promises that seem too good to be true, cautious can help you mitigate the risk of falling victim to these fraudulent schemes in the cryptocurrency market. Invest wisely and stay informed.
