New Study Reveals Common Bitcoin Scams Cost Victims Billions in 2022

A new study by Coin Kickoff that sheds light on common Bitcoin scams and their financial impact on individuals. Here are the key points from the study:

1. Crypto Scams Overview: While only a small fraction (0.24%) of cryptocurrency transactions are linked to illegal activities, the financial impact on victims can be significant. In 2022, crypto-related scams amounted to $20.1 billion.
2. Types of Common Scams: The study identifies the most common types of crypto scams, including blackmail, sextortion, and ransomware. Blackmail scams involve threats to release personal data or embarrassing photos unless a crypto payment is made. Sextortion scams target victims, often young individuals, by tricking them into sharing explicit content and then demanding payment. Ransomware attacks lock up a victim’s data and demand cryptocurrency for its release.
3. Scam Evolution: The types of crypto scams have evolved over time. While blackmail has been the most reported scam since 2018, ransomware scams have become more prevalent in 2023. Investment scams have seen a decline as people become more aware of the risks involved. Giveaway scams have gained traction, with scammers posing as celebrities to lure victims.
4. Financial Impact: Bitcoin scammers received an average of $1,664,899 in the first half of 2023. The total value received by Bitcoin scammers peaked at $55.04 billion in 2021, likely influenced by the boom in decentralized finance transactions and related crimes. Another report showed that investors lost over $20 billion to various cryptocurrency scams.
5. Protecting Against Scams: The article emphasizes the importance of awareness and caution in protecting against crypto scams. Investors are encouraged to do their homework, seek reliable information sources, and be cautious when engaging with cryptocurrency-related offers, especially on social media.
6. Individual Victims: While the percentage of crypto transactions linked to scams may seem small, the financial and emotional toll on individual victims can be significant. Crypto scams often rely on human nature and trust, making awareness and caution crucial in avoiding falling victim to scams.

The study analyzed abuse reports sourced from chainabuse.com, focusing on 232,455 unique abuse reports spanning from 2018 to June 2023.

Overall, this highlights the persistence of crypto scams and the importance of educating individuals to protect themselves from falling prey to fraudulent schemes in the cryptocurrency world.