CloudSEK has warned investors in cryptocurrency of Increasing threats by scammers.
Recall that the FBI has made a similar alarm about increasing crypto scams on the social media platform, LinkedIn.
CloudSEK which said that it has discovered a new scam known as CoinEgg noted that cryptocurrency holders in India have been defrauded of about Rs 1000 Crores through CoinEgg.
By using multiple payment gateway domains and Android-based applications, ‘CoinEgg impersonates crypto trading platforms and gets Investors to make fake exchanges through free credit before they start trading.
Crypto holders who invest their money make profits.
Shortly after a victim realizes the con and lays complain to the platform, they(scammers) use fake accounts and pose as investigators to help their victims and in the process, freeze their victim’s account to prevent them from making withdrawals.”CloudSEK said.
No fewer than 46,000 people were reported to have lost over $1 billion in cryptocurrencies to scams in 2021.
This figure rose by nearly 60 times with each losing an average of $2,600, according to the Federal Trade Commission.
The FTC in the report had identified social media platforms as an avenue where scammers had lured their victims before defrauding them.
“Reports point to social media and crypto as a combustible combination for fraud. Nearly half the people who reported losing crypto to a scam since 2021 said it started with an ad, post, or message on a social media platform.
“During this period, nearly four out of every ten dollars reported lost to a fraud originating on social media was lost in crypto, far more than any other payment method. The top platforms identified in these reports were Instagram (32 percent), Facebook (26 percent), WhatsApp (9 percent), and Telegram (seven percent).
The report stated that about 70 percent of victims had confessed to paying their scammers in Bitcoin,10 percent in the tether, and 9 percent paid with Ethereum.
These scams have continued to flourish, aided by one, a lack of authority to check these scamsbefore they occur.
“There’s no bank or other centralized authority to flag suspicious transactions and attempt to stop fraud before it happens, “These considerations are not unique to crypto transactions, but they all play into the hands of scammers.” the federal agency said in the report.
Last week, the Federal Bureau of Investigation (FBI) identified the social media platform, LinkedIn as becoming a hub for scammers.
The agency had warned of increasing Crypto scams carried out via the platform. These concerns are one among many factors that are leading more countries to adopt regulations.
China, for example, has for a long now, identified user safety, as a major cause of concern in its regulation of cryptocurrency