Scam in cryptocurrency has long gone beyond naive fakes and turned into sophisticated schemes disguised as investment projects, startups, and even charitable initiatives. Deception takes forms where truth sounds more convincing than lies. That is why it is important to understand the mechanics and typology of such scams in order not to fall into the trap.
What is cryptocurrency scam and how does it work
Cryptocurrency scam is a form of deception in which fraudsters disguise fraudulent schemes as real investment offers or blockchain technologies. The goal of such actions is the illegal acquisition of crypto assets by misleading users: through fake websites, counterfeit tokens, false income promises, or hacked accounts. It uses the attractiveness of digital assets as bait.
The demand for tokens grows along with the desire to make quick money. Fraudsters take advantage of this by creating scams wrapped in technology. According to Chainalysis, in 2024, the volume of stolen funds in blockchain exceeded $9.9 billion. Fraud in the crypto sphere evolves, changes forms, but the goal remains the same — to obtain money through deception.
The crypto market is developing its ecosystem faster than regulators can understand it. Anonymity, decentralization, lack of guarantees — fertile ground for fraud. Investigations show that phishing sites hide behind one project, empty tokens with aggressive marketing behind another.
Types of cryptocurrency scams
Scams are divided into categories based on the principle of deception. Each type uses its own mechanics, psychology, and communication channels.
Common forms of fraud in the crypto sphere:
- Phishing. Fraudsters create copies of popular exchanges and wallets. The goal is to gain access to private keys and data. The presentation varies from email campaigns to search advertising. One click — and the digital asset is forever lost to someone else.
- ICO scams. Projects announce fundraising for launch. Creators issue tokens, promise growth, provide fake forecasts. After raising investments, they disappear. A well-known case is Centra Tech, where scammers raised $25 million using fake consultants and forged documentation.
- Pyramids and Ponzi schemes. Promises of high dividends, accrued at the expense of new participants. A vivid example is BitConnect: in 2017, the token was worth $463, a month later — $1. The scheme collapsed when the influx of new investors stopped.
- Rug pulls. The team develops a DeFi project, attracts liquidity, and then instantly withdraws it. This was the case with the AnubisDAO project, with investors losing $60 million. Victims are left with useless tokens.
- Fake airdrops and Giveaways. Participants are promised free tokens for subscriptions or fund transfers. Often the names of well-known brands are used, such as Tesla or Binance. Verification of the source and domain is absent — money is lost in seconds.
Financial manipulations on the blockchain take on hybrid forms. ICOs and phishing, tokens and pyramids are combined. It is important to recognize patterns before making a transaction.
Why cryptocurrency scams exist
The reasons are simple and not geographically dependent. The desire for quick profit, limited expertise, and lack of legal protection create ideal conditions. A platform without audit, an anonymous team, aggressive advertising — risk triggers.
Scams in crypto assets thrive on a lack of knowledge. People do not analyze whitepapers, do not check the team, do not verify tokenomics. Fraudsters actively exploit this vulnerability, including influencers and pseudo-experts on YouTube.
Real cases and statistics
Behind the loud schemes in the crypto world are specific individuals, sums, and shattered destinies. These stories are not hypothetical risks but confirmed facts that have left millions of users without funds.
Specific names and figures:
- PlusToken (China, 2019) — a pyramid scheme with losses of $2.25 billion. Promised 10–30% per month.
- WoToken — another copy of PlusToken. Losses — $1.1 billion. The scheme is almost identical.
- OneCoin — a pseudo cryptocurrency without a blockchain. Attracted $4.4 billion in investments. The project leader is still in hiding.
- Thodex — a Turkish exchange, the CEO fled with $2 billion. The exchange promised free Dogecoin to all new users.
Such projects impress not by scale but by the trust they managed to evoke.
How to avoid cryptocurrency scams
Cryptocurrency scams do not attack directly — they insinuate themselves into trust. Protection requires strategy and attention to detail.
Expanded list of security rules:
- Check the project team: public profiles, experience, connections with real companies.
- Analyze tokenomics: who holds a large share, how funds are distributed.
- Study the roadmap: specific stages, deadlines, reporting.
- Check the audit of smart contracts: reports from third-party organizations (e.g., CertiK).
- Avoid projects with guaranteed returns: the market is volatile, stability is a sign of manipulation.
- Never transfer digital currency to unfamiliar addresses: often used under the guise of “refunds.”
- Keep funds in your own wallet, not on an exchange: increases security.
- Use two-factor authentication and cold wallets.
- Check the website address: even replacing one letter can lead to a fake platform.
Avoiding cryptocurrency scams is a matter of habits and discipline. Deception often occurs with those who do not check the details and follow the hype.
Why investing in cryptocurrency carries risks
Cryptocurrency scams are not the only threat. Even legal projects can lead to losses. The crypto market remains highly volatile: token prices can drop by 80% in a day. Bitcoin volatility, for example, in 2022 exceeded 60% — six times higher than that of gold.
Investing in cryptocurrency risks also include technological failures. Exchange hacks, errors in smart contracts, vulnerabilities in wallets — all of this has already led to millions of dollars in losses.
How to protect cryptocurrency from attacks
Fraud in the crypto sphere will not disappear. Scammers adapt to trends: they use deepfake videos, DNS spoofing, infiltrate Telegram groups. Protecting digital assets is based on three principles:
- source verification;
- physical isolation of keys;
- regular monitoring of transactions.
Hardware wallets Ledger, Trezor are suitable for storing data and tokens. The use of multi-signatures, monitoring activity on the blockchain, regular software updates significantly increase security.
Example: when attempting phishing, a user with a hardware wallet receives a notification of the recipient’s address. If it does not match — the transaction is canceled.
Conclusion
Scam in cryptocurrency is formed at the intersection of greed, anonymity, and lack of control. Deception replaces innovation, playing on demand growth. Without verification, analysis, and sober calculation, it is impossible to earn. Blockchain provides tools, but does not negate common sense.
Long-term investing involves holding assets for several years, despite short-term market fluctuations. Patience and fundamental analysis are the key factors for success in this case.
Effective cryptocurrency investment strategies help manage risk and increase returns. Long-term investments are suitable for patient investors who are willing to wait for the price of promising assets to rise. Short-term trading requires attention and knowledge of technical analysis.