Crypto Traders Are Raking in Millions, but So Are the Scammers

November

22

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With the crypto sector booming at an all-time high, individuals are actively getting involved in crypto trading. Although the concept of digital currencies is still foreign to many, it does not stop them from learning and indulging more in this new sphere.

Not long ago, when people didn’t know anything about cryptocurrencies and firmly refused to keep up with this alien trend, only a few governments realised its potential like the one in El Salvador. Today, it has accepted Bitcoin as a legal tender.

Since cryptocurrencies are influencing the global financial systems to a large extent, several large businesses have also joined in and started accepting crypto payments, widening their clientele. Despite the advantages they possess, like quick and secure transactions, lower fees, and decentralization, cryptocurrencies have also witnessed many downfalls lately.

Recent cryptocurrency scams

As per the Federal Trade Commission (FTC), the reports of crypto scams from October 2020 to March 2021 have soared to approximately 7,000 people losing more than $80 million.

Another report says that Netflix’s “Squid Game,” which led to a sudden spike in the new SQUID crypto trading for as much as $2,861, dropped to $0 after scammers stole millions.

The SQUID website allowed users to buy digital coins and not sell them, which is an apparent sign of a possible scam.

Angie Barnett, President and CEO of the Better Business Bureau, was also duped $1,800 after being approached by a fraudulent trading platform. Despite Bitcoin’s value being low for three consecutive days, her investment of $300 took off to $9,500. But, to withdraw her profits, she was asked to pay a one-time “customer service” fee of $1,500 in Bitcoin. Of course, after paying off, she found out that no real profit is coming her way – and that she was scammed.

Out of the many, these are just a handful of crypto scams that have been doing the rounds recently. The FTC, therefore, urges people to educate themselves before investing in such a highly volatile and dynamic market.

How to secure your crypto wallet

Crypto exchange platforms offer wallets for individuals to store and exchange their funds. However, many fell victim to malware and hacking. Therefore, ensuring that you use multi-level authentication and robust login credentials is vital to ensuring your wallet is safe.

Using an offline wallet service, accessible through your desktop or mobile, is a foolproof method of storing your cryptos safely. Numerous products are available like hard wallets that allow users to store their crypto in a secure device that is virtually impossible to hack.

Additionally, you should not share your credentials with anyone. Furthermore, clients should only login to their wallets from their personal devices and avoid using public computers to access accounts.

Using a safe broker is key

The online exchange where you invest in cryptocurrencies makes all the difference. Therefore, the better and more trusted online brokers like Trustpac, which specializes in cryptocurrency trading, use robust SSL security commonly implemented by banks. In addition, brokers should make traders aware of how to safeguard their accounts and avoid being scammed.

When it comes to safe trading options, a great way of securing your crypto investments is through CFDs. These assets do not involve the actual buying and selling of assets, but rather to trade on its value, therefore being able to seize short-term opportunities as well. “The big advantage of CFDs is certainly the comfort of it, especially when dealing with cryptocurrencies, which are more complicated to buy and sell,” said Gavin Visser, an account manager at Trustpac, “but also the ability to sell short is a big plus here.”

Losses are not always related to bad trades, but also the loss of information due to poor judgement. Therefore, clients should be aware of the pitfalls and if an opportunity seems too good to be true, well, it probably is.

About the author, Declan Yin

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