The FBI says that 2023 was a document yr for cryptocurrency fraud, with complete losses exceeding $5.6 billion, primarily based on practically 70,000 studies acquired via the Web Crime Criticism Heart (IC3).
This marks a forty five% improve in losses in comparison with the earlier yr, pushed primarily by funding fraud, which accounted for 71% of the whole cryptocurrency losses. Different forms of fraud contributing to the statistics embody tech assist scams, name middle fraud, and authorities impersonation.
The overwhelming majority of the reported losses ($4.8 billion) had been incurred by U.S. residents, adopted by Cayman Islands ($196M), Mexico ($127M), Canada ($72M), the UK ($59M), India ($44M), and Australia ($25M).
Within the U.S., California is the state that suffered the best damages, recording losses of $1,155,000,000 adopted by Texas ($412M), Florida ($390M), and the New York ($317M).
Supply: FBI
FBI’s report highlights numerous fraud traits that dominated 2023. In what considerations funding fraud, the primary traits revolved round variations of relationship apps {and professional} networking platforms resulting in “pig butchering” websites.
There are additionally liquidity mining scams the place victims are promised excessive returns for staking their belongings in a liquidity pool.
Criminals in 2023 additionally created pretend gaming purposes claiming to be primarily based on blockchain applied sciences. They promised gamers cryptocurrency rewards to trick them into connecting their wallets.
Fraudsters additionally used cryptocurrency restoration scams the place they aim victims of earlier scams, providing pretend restoration providers for stolen cryptocurrency. These schemes typically require upfront funds for retrieving misplaced funds.
The right way to shield from cryptocurrency fraud
The IC3 report explains that cybercriminals goal cryptocurrency due to its decentralized nature, the existence of mechanisms that may assist obscure the cash hint, and the sufferer’s incapacity to revert fraudulent transactions.
Cryptocurrency holders can shield themselves from fraud by following these suggestions:
- Be skeptical when met with “too good to be true” funding guarantees
- Confirm the legitimacy of funding platforms earlier than committing any funds.
- Ask your funding advisor to fulfill in individual, and deal with refusal as a pink flag.
- Use separate cryptocurrency wallets for gaming and investments.
- Periodically verify pockets permissions utilizing a trusted third-party token allowance checker software, and revoke entry the place crucial.
- Keep away from liquidity mining swimming pools that don’t comply with cryptocurrency market fluctuations.
- Be cautious of personal restoration firms claiming means to grab stolen cryptocurrency and requiring upfront funds.
- Independently confirm caller identities by calling firms again utilizing publicly obtainable contact data.