Crypto-scams on the rise
Written by R. A. Stewart
A newspaper article appearing in the Christchurch press headlined, “Cyber-scams cost Kiwis $3.7m highlighted the dangers posed by those who are investing in online share market, crypto, or NFT platforms. The $3.7m refers to the amount lost to these types of scams in just the first three months of the year.
The sudden rise in popularity of NFT’s (non-fungible tokens) is a contributing factor in the rise of scams.
Cryptocurrency scams are increasing according to the article but not to the same extent as those scams relating to NFTs.
NFTs are unregulated and expensive and payment was difficult to reverse.
The fear of missing out has created a demand for crypto and NFTs which has resulted in many investors investing in something which promised a great return only for it to be just a scam.
The article gave this great advice which really is applicable to all kinds of investments whether it is online or offline and that is to do your due diligence.
As far as cryptocurrency goes, due diligence means searching the name of the investment with the words “scam alert”, or searching the FMA warning and alerts page.
Another important thing is to not feel pressured in anything. If you are told to invest within a short time or you will miss out then don’t bother because the promoters of such a scheme are only trying to take advantage of the “Fear of missing out,” mentality in you.
A phishing scam is the most reported scam. It is when you receive an email from someone posing as a trusted site or business in order to gain your personal details. They ask for your log in details and use it to gain access to your accounts. Different strategies may be used and one is when you receive an email asking you to verify your account. When you register for a site you are asked to verify it within 24 hours of joining. If you receive an email asking you to verify your account months after you registered then be wary and do not click on the link provided.
It is also a good idea when registering with a crypto or NFT site to use an email address which is different from your personal one and certainly do not use the same one you would normally use for your banking or online auctions.
As far as banking goes; do not use your main debit card for crypto trading but rather a separate one because of the risks of hacking. Even with all of your own due diligence, there is also the possibility that the crypto exchange website with all of your banking details will get hacked and that is out of your control. It is up to each investor to do their own homework and take responsibility for their own decisions. That way you have only yourself to blame if you lose your money.
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DISCLAIMER: Please note, this article is not intended as financial advice but rather the opinion and experience of the writer. Caution is advised when investing in cryptocurrency or NFTs.
