The Rise of Fraud in Web3: What Crypto Investors Should Know
In today’s article, our Coinmooner team would like to share the opinion of one of the leading regulators on the issue of fraud, which continues to spread in the Web3 industry. Every day, fraudsters find new ways to deceive users, and their actions are becoming increasingly sophisticated. We believe it is essential to discuss the current situation to help our readers better protect themselves and their assets.
According to information from the Financial Markets Authority (FMA), fraudsters actively use the YouTube platform to promote their "services." They post videos with tips on investing in cryptocurrency to attract the audience's attention. Then, viewers are invited to join closed groups on messaging platforms like WhatsApp or Telegram, promising high returns and bonuses. In these groups, the fraudsters pose as professional investment advisors, convincing users to invest in fake platforms. These websites are created with a carefully designed interface that mimics popular cryptocurrency exchanges, making the scam seem incredibly believable.
The fraudulent scheme works as follows: first, investors are asked to deposit a small amount to test the "functionality" of the platform. Afterward, users are convinced that their investments have generated huge profits and are offered to withdraw their funds. However, additional fees or charges are suddenly required when trying to withdraw. Naturally, the money stays with the fraudsters, and the users lose their investments.
Fraudsters Targeting Cryptocurrency Users: What You Need to Know
The regulator emphasizes that these schemes are primarily effective due to videos with "insider" tips on which cryptocurrencies are worth investing. People often trust promises of easy profits, ranging from $2,000 to $7,000 a day, and fraudsters skillfully exploit this trust, assuring that such earnings supposedly come with no risks.
The FMA recommends checking the legality of trading platforms through the Financial Service Providers Register (FSPR) to protect themselves. This will help ensure that the company is authorized to offer such services. The regulator also strongly advises against contacting unknown individuals, sharing personal information, or clicking on suspicious links in videos or messages. Additionally, the FMA urges the public to immediately report any suspicious emails or fraudulent activity on YouTube to the Department of Internal Affairs.
In addition, in August, New Zealand's Ministry of Revenue proposed stricter reporting requirements for cryptocurrency transactions by virtual asset service providers (RCASPs). The new initiative aims to increase transparency in financial transactions and combat illegal schemes. Previously, local authorities had already required traders to declare income from cryptocurrency transactions, which was essential in strengthening oversight of this rapidly growing industry.
Our Coinmooner team would like to remind you that in the Web3 industry, it is crucial to use modern security methods to protect your finances. In the rapidly evolving digital environment, such measures are not just recommended but essential. Stay informed, be cautious, and don’t let fraudsters exploit your trust.
