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What are the most common crypto scams?

26 May, 2022

It’s impossible to overstate just how buzz-worthy cryptocurrencies and the blockchain that enable them have become over the last 10 years. From an obscure but promising alternative to fiat currencies to “digital gold”, they have become a controversial mainstay in the financial world.

Over 100 million people are now using cryptocurrency exchanges, with the total value of all cryptocurrencies adding up to almost $2 trillion - although this figure has proven volatile as markets enter a state of flux.

Investing in cryptocurrencies comes with a number of risks beyond mere market fluctuations though, as the security of cryptocurrencies and NFTs have proven to be woefully lacking. Just last year, there was over £11.8 billion worth of stolen crypto, according to blockchain analytics firm Chainanalysis.

So what are the ways in which scammers separate people from their crypto? Join us as we share the facts.

How cybercriminals are stealing crypto

Where there’s money, there are scammers. It’s no different with cryptocurrencies, and the consequences can be financially catastrophic.

One recent hacking incident involved the theft of over £433 million from Poly Network, before all but £25 million was transferred back. There have been many more similar incidents, with Binance losing $41 million to hackers in 2019. Just last week, actor Seth Green had his ‘Bored Ape Yacht Club’ NFT stolen, pausing production on his TV show which utilised the character.

Many online scams target new investors who are keen to hop onboard a particularly hot market.

These scams utilise the fact that cryptocurrencies are still complex and not all investors have an in-depth understanding of how the systems around them work. Due to this general lack of knowledge, investors are more likely to fall for scams that enable cybercriminals to steal their money.

A common type of scam is where scammers pose as celebrities or well-known investors encouraging people to invest in crypto, but once they pay the money they receive no crypto tokens in return.

However, the most common type of attack is good old fashioned phishing. By far the most common attack type across cybersecurity in general, it’s also a popular attack type in crypto scams.

Put simply, phishing attacks involve sending emails purporting to be from legitimate sources, but are in fact from scammers.

An example might be an email that appears to be from your crypto exchange, requiring an update of passwords for security purposes. Once you click through and input your details it’s too late - the scammer has your account and can effortlessly transfer your tokens and NFTs to another wallet.

How to protect yourself and your businesses from crypto scams

With more businesses offering digital currency payment options, and more people investing in the market, reducing the risk of falling victim is a top priority.

With 90% of successful attacks occurring as a result of human error, the only truly effective tool against attacks is education about what the attacks look like and what to do if you think you spot one.

With cybercriminals continuously developing new scams and techniques to penetrate system vulnerabilities and to trick people, it is important that individuals receive regular training to receive updates on the latest methods criminals are using.

That’s why, at Bob’s Business, we have over 50 engaging cybersecurity awareness training modules covering everything from malware to phishing, alongside compliance topics like GDPR and PCI-DSS.

Book your free consultation with a Bob’s Business expert to find out more about our highly effective training solutions.

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