Unlike 2017, last year saw its fair share of up and downs for cryptocurrencies. It will be remembered as a bear market. However, the falling value of virtual currencies in 2018 did not deter scammers from preying on unsuspecting individuals. Below we are going to have a look at three top crypto scams of 2018.
Telegram and Discord pump and dump crypto scams
Pump and dump scams are still rife within the crypto space as recent research from the Social Science Research Network found out. The most popular platforms to carry out these scams are messaging apps where intense marketing takes place.
Researchers identified 3,767 and 1,051 pump and dump scams on Telegram and Discord respectively — a number that indicates how prevalent the practice is within the space. The scams targeted various altcoins however Bitcoin was not immune to the schemes. The research found at least 82 scams that targeted Bitcoin on the two apps.
Currently, in the U.S. the practice is considered a securities fraud by the U.S. Securities and Exchange Commission (SEC).
It didn’t take long before allegations of running a Ponzi scheme begun to surface. What made the project look even more suspicious was their referral system and the fact that the platform’s owners were unknown. This led to a cease and desist order from regulators in the U.S.
However, investors worst fears were confirmed earlier last year when the anonymous owners of the platform sold their holdings and made away with reserves of BTC.
What’s your take on these top crypto scams of 2018, share your thoughts in the comment section below.