According to a study issued by the Federal Trade Commission on Friday, more than 46,000 customers claim to have lost over $1 billion in cryptocurrency to scammers since the start of 2021.
Last year's losses were approximately 60 times more than the previous year's, with a median individual loss of $2,600.
The main cryptocurrency consumers indicated they used to pay fraudsters were bitcoin (70 percent), tether (10 percent), and ether (10 percent), according to the FTC (9 percent ).
Payment transactions in cryptocurrencies like bitcoin are final and cannot be reversed, which is a critical feature. This isn't usually a positive attribute. Chargebacks, a form of consumer protection tool, allow customers to cancel a transaction if they believe they were wrongfully charged for a product or service they did not obtain.
Nearly half of those who have lost cryptocurrency to a scam since 2021 say it began with a post on a social networking platform. Instagram (32 percent), Facebook (26 percent), WhatsApp (9 percent), and Telegram (9 percent) were the main platforms named in these concerns (7 percent ).
Scams involving phony investment possibilities were by far the most prevalent. The FTC reported $575 million in crypto fraud losses connected to investment offerings in 2021. People claimed that investing websites and applications would allow users to follow the progress of their cryptocurrency, but the apps were phony, and they were unable to withdraw their funds.
The FTC warns in its study that "there is no bank or other centralized authority to identify questionable transactions and seek to halt fraud before it happens." "These factors aren't unique to cryptocurrency transactions, but they all play into the hands of con artists."
Business and government impersonation schemes, which the FTC says generally begin with bogus mails pretending to be from tech corporations like Amazon or Microsoft, are the second-most prevalent cause of crypto fraud losses.
Crypto fraudsters were more likely to target younger customers. People aged 20 to 49 were more than three times as likely as older age groups to report losing cryptocurrency to a fraudster, according to the FTC.
People should recognize that cryptocurrency investments never have guaranteed returns, avoid commercial deals that necessitate a cryptocurrency purchase, and be wary of amorous come-ons accompanied with a crypto solicitation, according to the FTC.
The announcement comes following a rocky few weeks in the cryptocurrency markets. A failing dollar-pegged stablecoin dragged down the whole crypto asset class, wiping half a trillion dollars off the sector's market size and sapping investor confidence. Many institutional and ordinary investors were wiped out, and there are no FDIC backstops or other consumer insurance measures in place.
Cameron and Tyler Winklevoss, billionaire bitcoiners, recently announced layoffs at cryptocurrency exchange Gemini, blaming the industry's "contraction period" dubbed as "crypto winter," which has been "further worsened by the present macroeconomic and geopolitical uncertainty."
Last year's losses were approximately 60 times more than the previous year's, with a median individual loss of $2,600.
The main cryptocurrency consumers indicated they used to pay fraudsters were bitcoin (70 percent), tether (10 percent), and ether (10 percent), according to the FTC (9 percent ).
Payment transactions in cryptocurrencies like bitcoin are final and cannot be reversed, which is a critical feature. This isn't usually a positive attribute. Chargebacks, a form of consumer protection tool, allow customers to cancel a transaction if they believe they were wrongfully charged for a product or service they did not obtain.
Nearly half of those who have lost cryptocurrency to a scam since 2021 say it began with a post on a social networking platform. Instagram (32 percent), Facebook (26 percent), WhatsApp (9 percent), and Telegram (9 percent) were the main platforms named in these concerns (7 percent ).
Scams involving phony investment possibilities were by far the most prevalent. The FTC reported $575 million in crypto fraud losses connected to investment offerings in 2021. People claimed that investing websites and applications would allow users to follow the progress of their cryptocurrency, but the apps were phony, and they were unable to withdraw their funds.
The FTC warns in its study that "there is no bank or other centralized authority to identify questionable transactions and seek to halt fraud before it happens." "These factors aren't unique to cryptocurrency transactions, but they all play into the hands of con artists."
Business and government impersonation schemes, which the FTC says generally begin with bogus mails pretending to be from tech corporations like Amazon or Microsoft, are the second-most prevalent cause of crypto fraud losses.
Crypto fraudsters were more likely to target younger customers. People aged 20 to 49 were more than three times as likely as older age groups to report losing cryptocurrency to a fraudster, according to the FTC.
People should recognize that cryptocurrency investments never have guaranteed returns, avoid commercial deals that necessitate a cryptocurrency purchase, and be wary of amorous come-ons accompanied with a crypto solicitation, according to the FTC.
The announcement comes following a rocky few weeks in the cryptocurrency markets. A failing dollar-pegged stablecoin dragged down the whole crypto asset class, wiping half a trillion dollars off the sector's market size and sapping investor confidence. Many institutional and ordinary investors were wiped out, and there are no FDIC backstops or other consumer insurance measures in place.
Cameron and Tyler Winklevoss, billionaire bitcoiners, recently announced layoffs at cryptocurrency exchange Gemini, blaming the industry's "contraction period" dubbed as "crypto winter," which has been "further worsened by the present macroeconomic and geopolitical uncertainty."
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