What Are Common Crypto Scams? Keep Your Crypto Safe in 2022

CRYPTO SCAMS

Crypto scams strive by developing new and innovative ways to trick you and being the victim of a scammer is considered a rite of passage for many of us in the cryptocurrency space. You can only avoid the minefield for so long before that moment comes. You know the importance of your private key, yet somehow you ended up exposing it to fake “Customer Support” agents. While you’re far more likely to lose everything in a pump & dump scheme, they sting equally.

Now I know some of you reading this are saying to yourself “That will never happen to me, I’m always careful”. Being careful is great and it’ll certainly help you to identify fishy-smelling situations but, like the famous boxing quote goes, “Everybody has a plan until they get hit in the face”.

Here are some of the most common and uncommon scams you’ll run into when navigating the cryptocurrency space.

Social Media Crypto Scams

OMG! Didn’t you hear that Elon Musk is giving away 10,000 $ETH live on Twitter right now! You better hurry up or you’ll miss it! If you haven’t run into this or one of the following common social media scams, give it enough time and you will eventually.

These types of scams are broadcasted to everyone 24/7. They say if I send them 10 $BTC they’ll send 100 back! Any assets that you send to these scam addresses will never be seen again, not by you anyways. It doesn’t make it any easier that platforms like YouTube and Twitter encourage these bad actors, providing unlimited access to the platform’s advertising and search engine optimization services. These “live” videos are extremely convincing to newcomers who see a 200,000+ subscriber channel showing actual footage of a previous speaking event. Oh, and there are 20,000 people watching it. It’s a very well-executed scam on newcomers.

Rampant throughout Twitter are links generating traffic to these fake events and giveaways. You can also find these scammers hiding out in the comment section of every video on Youtube, relentlessly spamming their WhatsApp numbers. Or baiting people into “Trading Programs” through scripted fake conversations about how much money they’ve made. 

These social media scams include directing traffic from popular platforms to participate in NFT minting, token offerings, and ICOs. These will always be fake sites that are selling fake tokens or no tokens at all, designed to look identical to the website of the original project…It is not. They include specially designed Telegram pages with 100,000+ members with messages turned off and a wallet address you can send funds to. In almost all cases these sites purchase search placement. So if you searched “XYZ Project ICO”, their website would be the first one listed. It’s a tragedy that so many of these things could be avoided with proper checks and balances. Yet they go on without. To avoid falling for these types of scams, always join a project’s social groups from safe links provided by CoinGecko or CoinmarketCap. In legitimate community rooms, there will never be an offer to send funds to a specific address. To participate in any coin offering or ICO in 2022 and beyond, you will have to pass a multi-step process including the KYC (Know Your Customer) and AML (Anti-Money Laundering) process. 

This is where “if it’s too good to be true” kicks in for most of you. There’s no easy way or shortcut to growing habits that build financial freedom. It doesn’t happen overnight and it’s important to have this mindset to shield yourself from these and many other scams. Some will go the extra mile instead of blatantly asking for $BTC, creating fake contests and airdrops to lure people into a honeypot of data collection. I see dozens of these every week when providing the “Verified Airdrop Report” for Wealth Mastery Members. Anything that asks you to provide information or “Sync” your wallet with a key is a fake contest or airdrop. Some of these may even ask for simple things like a phone number or your full name. These are very unsafe and why you should still practice caution when signing up for anything through seemingly harmless sites like Sweepwidget, Gleam, and Medium.

Pump & Dump Crypto Scams

This category includes your ponzi schemes, ICO scams, and other types of rug pulls. This is generally a group of people who get together with the intention of stealing your assets over a longer period of time. Much longer than other scamming techniques being discussed. This is the long con after all.

Some of these scams can take up to a year before they pull the rug and exit. This is why doing your diligence and really researching something is extremely important. No one wants to throw money away on any of these scams but you especially don’t want to waste a year of your time and money. While there’s truth to starting over stronger from experience, I’m sure everyone would rather avoid it if they could.

Lately, these types of schemes have found a cozy home in the NFT and DeFi sectors, creating hype for worthless NFT art collections or token creation events, then disappearing shortly after selling their “art” or the ICO has ended. These projects can be avoided by verifying the credibility of a project’s team and staying away from anything that includes marketing for unrealistic expectations of profit through over-hyping.

A different but equally disastrous pump & dump scammer is the endless amount of “influencers” on social media. These individuals exploit their audience exclusively for their own benefit. Under the guise of “education”, these individuals will buy assets months in advance before casually announcing their “hot new altcoin pick” on their website and social media channels. Creating buzz so they can profit from selling their positions at a premium and these individuals are incredibly easy to spot. In most cases, you can see their prior pump & dump victims commenting on their content in displeasure. A good way to tell if your favorite influencer is a pump & dumper is if they use the headline “WARNING” and “EMERGENCY” in every other post? Do they tell you they’re selling or buying a specific token and “you should too”? If you answered yes to either of those questions, the chances are extremely high they are pump’n and dump’n all over you. Those who honestly seek to educate their community will share ideas and information in a balanced way, stating facts first. The kind of way that feels like you’re having a conversation with someone, instead of feeling like they’re trying to convince you into their way of thinking.

Crypto Phishing Scams

Fake exchanges, destructive malware, and other phishing scams are everywhere. When you’re invested in blockchain the stakes are raised for scammers who are incentivized by more than just stealing your favorite streaming account information. No matter what the case may be, these types of scams are built with the purpose of stealing your identity and funds or blackmailing you into doing so through ransomware. These are most commonly found in your email and social media inboxes. Join a new Discord or Telegram group and expect the vultures to start circling. This is one of the most common types of scams because bad actors target everyone without you initiating it.

For this reason, it’s extremely important that you understand that “EVERYONE” direct messaging you is a scammer. Asking for help in a chatroom is the same as pouring blood into the water to attract sharks. For your safety keep all questions you have in the public chat. Or better yet, if all you want is updates from your favorite project. Join the “Announcement Only” channel instead. By default, apps like Reddit, Telegram, and Discord all have direct messages turned on. Learn how to disable or change these settings to suit your needs for each app and you can avoid the majority of these scammer’s methods.

Some of the best ways to avoid being phished are:

  • NEVER go to any websites that someone randomly sends you. These are all scams and you will end up falling for them.
  • NEVER “sync” your wallet to any website. This is not the same as “connect wallet” where you are signing an approval transaction to interact with a dApp. This is a site asking you to give a QR code, private key, seed phrase, JSON key, or secret recovery phrase in order to “Sync” or “Validate” and gain access.
  • NEVER enter your 12-word passphrase or any of the others mentioned above into “ANY” website or conversation on the internet.
  • Make sure any wallet you download is directly from the original website.
  • Bookmark websites that you use regularly to avoid accidentally mistyping them in the address bar.
  • Practice keeping social media accounts private and avoid sharing personal information publicly. This includes birthdays, locations and other personal information scammers can scrape from your profile.
  • To have the highest level of protection it’s always advised that you invest in and store your coins & tokens on a Hardware Wallet in case someone gets control of your accounts or computer. This way your Private Key is safely stored offline.

Trading “Professionals” & Mining Program Scams

These things have been popping up everywhere the last couple of years. Usually referred to as copy-trading, trading bots, professional trading courses, and cloud mining, these products are shilled in every corner of the cryptocurrency space. While “professional trading courses” that promise absolutely incredible returns have always been well-known scams, trading bots and cloud mining at one point were actually very real and profitable. Many crypto OG’s are familiar with Gunthy and his incredible trading bot. As well as receiving daily payments from Ccoud mining platforms we purchased mining power from. Unfortunately, that’s no longer the case. The landscape has changed and those tools are no longer relevant or profitable to pursue. 

In their dying absence, fake websites have begun to pop up promising the best returns and “trading strategy” on the market. These types of programs often called “copy-trading” or “trading bots” have nothing to do with trading at all. The moment you sign up on their website, you’re bombarded with minimum deposits and convoluted withdrawal restrictions. This is all put in place so the scam can operate longer. If there were no withdrawal rules people would know almost instantly they’d been had. But, if you can’t pull your crypto out for 30 days, and there’s “system maintenance” when you try. They’re able to scam more people before it all blows up and they have to reset with a new website.

Be very careful with these scams that promise giant returns with automatic trading. Generally, anything that promises to “make you rich” is taking you for a ride.

What Are Common Crypto Scams? Keep Your Crypto Safe in 2022 - - 2022

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What Are Common Crypto Scams? Keep Your Crypto Safe in 2022 - - 2022

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