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FTC seeing ‘huge spike’ in cryptocurrency investment scams

Britain Cryptocurrencies
Posted at 4:29 PM, May 18, 2021

WASHINGTON, D.C. — The Federal Trade Commission (FTC) says there’s been a “huge spike” in cryptocurrency investment scams over the past several months.

A new data analysis from the agency shows consumers have reported losing more than $80 million to these scams since October. That’s an increase of more than ten-fold year-over-year.

The FTC looked at nearly 7,000 reports received about these scams in the last quarter of 2020 and the first quarter of 2021. It found the average amount consumers report losing was $1,900.

The FTC says these cryptocurrency scams can take a variety of forms.

Sometimes, they start as an offer for investment “tips” or “secrets” in online message boards that lead people to phony investment websites.

Another common form of the scam involves a promise that a celebrity associated with cryptocurrency will multiply any cryptocurrency you send to their wallet and send it back, the FTC says.

Consumers have actually reported losing more than $2 million to Elon Musk impersonators alone since October, according to the FTC.

Officials found that consumers age 20 to 49 were over five times more likely than older age groups to report losing money to a cryptocurrency investment scam, and in the six-month period covered by the analysis, consumers in their 20s and 30s lost more money to investment scams than any other form of fraud. More than half of their investment scam losses were in cryptocurrency.

Learn more about avoiding cryptocurrency investment scams here.