Over 46,000 people lost over a billion dollars collectively to crypto scams from the start of 2021 to Q1 2022, according to the Federal Trade Commission (FTC).
Cryptocurrency-related scams made up about 25% of all the reported losses to the FTC during that period.
According to the FTC’s report, out of the billion dollars, people lost approximately $575 million in investment-related fraud, $185 million in romance scams, $93 million to business impersonation scams and $40 million to government impersonation scams.
70% of the payments to scammers were made in Bitcoin, followed by Tether at 10% and Ether at 9%.
Almost half of those who reported getting scammed said they were tricked through social media. Moreover, 40% of all the money lost on social media was withdrawn in cryptocurrencies.
The most scams happened on Instagram (32%), followed by Facebook (26%), Whatsapp (9%) and Telegram (7%).
“These scams can start with a text about a supposedly unauthorized Amazon purchase or an alarming online pop-up made to look like a security alert from Microsoft. From there, people are reportedly told the fraud is extensive and their money is at risk,” the FTC report reads. “The scammers may even get the “bank” on the line to back up the story. (Pro tip: it’s not the bank.).”
There has been a 60 times increase in the reported losses due to cryptocurrency-related fraud between 2018 ($12 million) and 2021 ($680 million),
“In another twist, scammers impersonating border patrol agents have reportedly told people their accounts will be frozen as part of a drug trafficking investigation. These scammers tell people the only way to protect their money is to put it in crypto: people report that these “agents” direct them to take out cash and feed it into a crypto ATM. The “agent” then sends a QR code and says to hold it up to the ATM camera. But that QR code is embedded with the scammer’s wallet address. Once the machine scans it, their cash is gone.”
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