Every investment comes with risk. Crypto scams are unfortunately one of the risks that come with crypto investments. The good news, however, is that scams during the past years have been decreasing. According to the Chainalysis crypto crime report, there was only a percentage of 0.15% of illicit transactions for 2021. Given that there was a record-breaking number of transactions for the year, worth over $15.8 trillion, this figure was quite surprising.
Increasing awareness of common scams can help investors avoid falling victim to illicit transaction activities. We have a list of common scams to keep you from falling into a crypto trap.
Ransomware
The report stated that there were over $692 million in ransomware payments in 2020, nearly double the amount from the previous year. Ransomware occurs when a user downloads software that contains payment sites that cybercriminals hack. Cybercriminal gangs behind these downloads tend to rebrand themselves to gain more victims.
How to avoid becoming a victim of ransomware
Ransomware fortunately isn’t considered too dangerous despite rebranding efforts from criminals. It is hard to avoid becoming a victim, however, according to the report, it pays to be wary of Monero as it is seen to be a common currency requested by criminals due to the anonymity required. It’s a good defense strategy to keep your anti-virus updated and only use crypto sites that are reputable and trustworthy. It is also advised that you always report cryptocurrency scams to the authorities.
Malware
Malware attacks aren’t new, but in crypto, they tend to occur in large organizations. Some criminals try to steal from individual users. Malware occurs when ransomware strains are delivered to a victims’ devices. According to the report, the malware that targets individuals involves spamming victims by tricking them to download software. There are 4 types of malware criminals in crypto, namely info stealers (those that steal the data and credentials of their victims), clippers (hackers that use clippers to rewrite cryptocurrency addresses), Cryptojackers (criminals that hack victim devices to mine crypto), and trojans (a virus that mimics a legitimate crypto program). Cryptojackers are the most common type of malware criminals with over 5,574 transactions in 2021.
How to avoid becoming a victim of malware
Invest in crypto cybersecurity software. Use this security software on all of your devices that you do your crypto trading from. If you receive emails relating to crypto, use a spam filter to keep any emails out of your inbox, and do not click on suspicious links or files. Use files that contain legit URLs that begin with HTTPS.
Stolen funds
The crime report states that over 3.2 billion in cryptocurrency was stolen in 2021 alone from individuals and services. Stolen funds are a result of risky operations, security breaches, and hacks. The good news is blockchain analysis can help investigators in most cases who can analyze the movement of funds from addresses to halt suspicious movement. It, therefore, pays to report these attacks to the local authorities.
How to avoid becoming a victim of stolen funds
Unfortunately, sometimes breaches can occur even on legit platforms. The best way to protect yourself is to choose reputable crypto platforms with good security protocols. Contact your crypto platform should you witness suspicious activity in your crypto wallets.
The bottom line
Crypto trading is exciting but can also be scary if you don’t take the necessary precautions. It is similar to banking online — you need to protect yourself by being wary of scammers and malware.
- Avoid downloading unknown software or clicking on suspicious links.
- Always use a platform that is reputable and has good security features.
- Invest in cybersecurity software and anti-viruses.
- Report breaches to the platform and the authorities who can help you to get your money back.
Sometimes even when you have made smart choices, you can be a victim of a tragic event such as a security breach on a platform. If this happens, don’t panic and do everything in your power to stay optimistic. Remember these scams are common and you are not alone, so blaming yourself is unproductive. Don’t let scammers deter your successful crypto journey.
Fortunately, the risk of having your funds stolen from you is constantly counteracted by newer and better security protocols. IXFI provides users with a highly secure and reliable platform, so you can be better protected from the scams discussed above. Register on Your Friendly Crypto Exchange and enjoy trading without worries.
Disclaimer: The content of this article is not investment advice and does not constitute an offer or solicitation to offer or recommendation of any investment product. It is for general purposes only and does not take into account your individual needs, investment objectives and specific financial and fiscal circumstances.
Although the material contained in this article was prepared based on information from public and private sources that IXFI believes to be reliable, no representation, warranty or undertaking, stated or implied, is given as to the accuracy of the information contained herein, and IXFI expressly disclaims any liability for the accuracy and completeness of the information contained in this article.
Investment involves risk; any ideas or strategies discussed herein should therefore not be undertaken by any individual without prior consultation with a financial professional for the purpose of assessing whether the ideas or strategies that are discussed are suitable to you based on your own personal financial and fiscal objectives, needs and risk tolerance. IXFI expressly disclaims any liability or loss incurred by any person who acts on the information, ideas or strategies discussed herein.
