![]() But you wouldn't know it from checking out Formula 1 racesĪnd in May, the CEO of Mining Capital Coin was indicted for “allegedly orchestrating a $62 million global investment fraud scheme” that promised sizable returns from mining new cryptocurrencies. ![]() Chandan Khanna/AFP/Getty Imagesīitcoin is imploding. McLaren's Australian driver Daniel Ricciardo races during the Miami Formula One Grand Prix at the Miami International Autodrome in Miami Gardens, Florida, on May 8, 2022. The founder was accused of misleading investors about the cryptocurrency’s “lending program,” claiming the company’s proprietary technology would bring substantive returns to investors by tracking cryptocurrency exchange markets. In February, a federal grand jury in San Diego indicted the founder of BitConnect for allegedly orchestrating a $2.4 billion global Ponzi scheme. “The stories people share about these scams describe a perfect storm: false promises of easy money paired with people’s limited crypto understanding and experience,” the FTC report said. More than half of the posts were seen on Facebook or Instagram.įake investment opportunities were behind $575 million of all crypto losses reported to the FTC, far more than any other fraud type. Nearly half of those who reported losing money to a crypto scam in 2021 said they were lured in through an online post or social media message. Since Bitcoin hit its peak of $69,000 in November, it’s lost more than half its value as investors have pulled out of riskier assets due to rising interest rates. The FTC’s warning comes at a volatile time in the crypto market. It has all the elements that give scammers an advantage – no bank to flag suspicious transactions, irreversible transfers and novice investors that are often largely unfamiliar with how crypto works. The victims typically are part of a younger age group – those aged 25-40 are three times as likely to lose money due to fraud.Ĭrypto scams are becoming increasingly popular, shooting up 60 times higher than in 2018. The vast majority of those who reported being bilked used Bitcoin to pay scammers, at 70%, followed by Tether and Ether. REUTERS/Arnd Wiegmann Arnd Wiegmann/Reuters Free pizza is offered during the "Happy Bitcoin Pizza Day" ahead of the World Economic Forum (WEF) in Davos, Switzerland, May 22, 2022.
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