Some individuals, as it turns out, are now using social media to scam people by enticing them to invest in cryptocurrencies.
In Detroit, Danielle and Chris Girt poured $500 into what they thought was a bitcoin investment on Facebook that later on turned out to be a form of scam.
“In the beginning, everything was kind of lining up legitimate, that was initially. When we started to get really skeptical was when they requested more money in order to even get withdrawal,” Danielle said, sharing their experience.
Scams increase in number
Federal investigators are reporting a massive spike in the number of cryptocurrency scams. In fact, since October last year, nearly 7,000 people came out and reported the losses they incurred. The total amount of money scammed totaled more than $80 million, placing the average loss to nearly $1,900.
“I think one of the easiest things people can get caught up with is that they’ve heard the stories of somebody being an early adopter to a cryptocurrency like Bitcoin and then years later they are a multi-millionaire,” said IRS Special Agent Christopher Janczewski, who investigates cryptocurrency cybercrimes.
He also added that perhaps there is fear of missing out on the next wave that pressures individuals to immediately invest without even studying first to determine the legitimacy of the opportunity presented to them.
A piece of advice
Janczewski advised would-be investors to do their research first before putting their money in any kind of investment.
He added there are probably 1,000 different cryptocurrencies out there. Some of them are legit while some are not. He thinks that planning to get in early causes people to not give as much thought as they would with another kind of investment.
Victims of scams are often lured to bogus websites that promise them big returns for crypto investments, said the Federal Trade Commission.
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