Crypto Ponzi Schemes: A Rising Threat
A new report by TRM reveals that in 2022, more money was lost to cryptocurrency Ponzi schemes and scams than to hacks and exploits. Here are the key points:
- Crypto investors were scammed through Ponzi schemes, losing at least $7.8 billion.
- Overall, victims lost about $9.04 billion to various fraud schemes.
- TRON blockchain was mostly used by these schemes, accounting for 40% of the fraudulently obtained funds.
- Hacks and exploits resulted in $3.7 billion of losses, with most coming from breaches of DeFi protocols.
- Bitcoin is no longer the preferred blockchain for scams, accounting for less than 3% of these crimes.
- Ethereum and Binance Smart Chain are now the primary platforms for cross-chain crimes, responsible for 68% and 19% of such incidents, respectively.
Moving To Other Blockchains
Due to Bitcoin’s decreasing anonymity, scams are now shifting to other blockchains. Here’s what you need to know:
- Approximately $2 billion was stolen through attacks on cross-chain bridges.
- Ethereum and Binance Smart Chain are the main targets for these crimes.
Regulators Struggle to Keep Up With Crimes
Regulators are facing challenges in combating cryptocurrency crimes. Here’s what you should be aware of:
- Crypto Ponzi schemes and scams are difficult to shut down or prevent.
- Individuals in the crypto space need to remain vigilant for scams as regulators often struggle to intervene in time.
- Notable Ponzi schemes include Forsage and Trade Coin Club, which collectively received over $695 million from investors.
Hot Take
The rise of crypto Ponzi schemes and scams is a concerning trend that highlights the need for increased awareness and vigilance among crypto investors. As criminals adapt to new blockchains and exploit vulnerabilities in the system, it becomes crucial for regulators and individuals to stay informed and take necessary precautions to protect themselves and the integrity of the crypto space.
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