One of the biggest concerns with cryptocurrency is the high-tech nature of the industry. The lack of regulations and unpredictability makes crypto the perfect target for scammers. Many investors have been scammed by individuals who claim to be crypto experts, but then disappear after the currency has skyrocketed. There are ways to protect yourself from these unscrupulous operators, but you’ll need to do some research. If you’re interested in investing in crypto, read this guide.
Several of the most common types of cryptocurrency scams target investors who use a digital wallet. A scammer tries to gain access to the recipient’s digital wallet through an impersonation scheme. The fraudsters use digital wallets to steal money, often using their physical hardware. If the scammer manages to get into your wallet, you will have to pay them back. In addition, some people may transfer cryptocurrency to their scammers because they were cheated by a company or person posing as an expert.
The most common form of cryptocurrency scam involves a hack of a popular cryptocurrency exchange. The stolen cryptocurrency is sold to a third party, which can lead to big losses. Sadly, there are numerous examples of this type of fraud. The largest and most notorious of these scams was carried out by Mt. Gox, which was the largest Bitcoin exchange in the world. In February 2014, a hacked crypto-mining site caused an estimated $470 million to be lost.