Cryptocurrency scams in 2021

People often fall for cryptocurrency scams because they are either new to the cryptocurrency world, or they are unfamiliar with cryptocurrency, most people also don’t know how to recognize a crypto scam.

There is also this popular belief on cryptocurrency that it can make you a lot of money within a short period. 

When you see an advert promising a double, triple, or even quadruple return within a short amount of time, you are hardly suspicious because it’s the popular believe that cryptocurrency can make you a lot of money within a short period, but those making money from crypto  don’t send it to someone to help them invest it in the hope of a double return.

Year 2021 had us see an influx of scammers into the crypto market, with scammers devising different means to defraud unsuspecting victims. This post highlights some crypto scams of 2021.

Crypto currency scam

Crypto Scams of 2021

1. Fake Accounts

These accounts are used to impersonate well-known people in the financial sector. 

Accounts are created on popular social media platforms, impersonating popular figures, with various tweaks to make it look authentic.

An unsuspecting individual can fall for this scam, believing it is the account of the real celebrity, and may do business with them without proper verification.

For the record, in January, hackers imitates Elon Musk’s official Twitter account and posted a link there directing his followers to his supposed bitcoin wallet.

The post offers to double anyone’s bitcoin deposit sent to the wallet and lots of Musk’s followers jumped at the opportunity, began sending their bitcoin without questions, and by the time they realized it was a scam, most people had lost a lot, from their investment funds to their retirement savings.

A man named Sebastian lost 10 bitcoin worth $550,000, and in total, more than $2 million was lost in that scam.

2. Giveaway Scams

You might have come across a statement of this nature; “If you send 1 bitcoin to this wallet address, then you are going to receive double”. Ordinarily you might think; “Why would people send cryptocurrencies to a random wallet address while expecting double back?”

But these scammers are smart, what they do is to impersonate a public figure, making it look like they are the ones doing the giveaway.

Popular faces used are Elon Musk of Tesla, Jeff Bezos of Amazon or Vitalik Buterin of Ethereum, and people fall for it because they know these guys are wealthy.

But you should know that no matter how legit a giveaway might seem, no one doing a giveaway will ask you to send your cryptocurrencies over to a wallet address, a real giveaway will ask you for your wallet address, then send cryptocurrency to your wallet address.

3. Altcoin Pump and Dump

Altcoins are any type of crypto currency other than bitcoin that is already popular and pricey, they are the several crypto currencies newly popping up.

These type of crypto are usually cheap and market price can be greatly influenced by mentions from crypto-gurus and industry players. Once the crypto-gurus buy a large amount of altcoin, they recommend the coin to their followers.

These followers then invest heavily in the coin, and once enough investments have been made, the influencer dumps their coin to make massive profits. Altcoin pump and dumps can cause the price to be cut by half in a single day.

One of the biggest altcoin pump and dump scams happened back in 2017. It involved cybersecurity pioneer and creator of McAfee Antivirus, John McAfee.

In December 2017, the Twitter-tech influencer tweeted that he would be embarking on something revolutionary, saying he would start talking about a “unique” altcoin each day.

That same month, McAfee and his executive assistant Jimmy Watson were indicted on multiple charges regarding cryptocurrency schemes.

According to court documents at the time, McAfee and his associates had illegally pocketed $13 million in altcoin investment money.

They had relied on McAfee’s popular Twitter account to push stories about niche cryptocurrencies and promote initial coin offerings without revealing that they stood to profit from the ICOs through investment gains and promotional fees.

Some creators of these altcoins were allegedly part of the deception.

In conclusion, I know the idea of making a lot of money in a short amount of time sounds appealing, but that’s not how this works. 

You have to be careful with these scammers, once you send your crypto out, you can’t say; “Hey Coinbase, I want my money back because I made a mistake”. They are not going to do that.

Work hard for your money, invest in quality companies and projects and if you are new to this world, spend at least 100 hours educating yourself, so you understand what you are about to do.

I hope you find this information useful, you can leave a comment if you had any questions.

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