Every year, the crypto industry loses billions in cryptocurrency scams. Since its inception in 2011, people have lost approximately US$22.7 billion to scams and hacks. In the first half of 2025, scammers stole US$2.47 billion, according to Certik’s report. Since crypto transactions take place on blockchain, it becomes nearly impossible to track and recover the lost cryptocurrency. As its use is growing, scammers are getting more active and using new tools and tactics to approach and steal more from new users. This blog offers a detailed account of cryptocurrency scams and provides effective tips to secure your crypto assets. So let’s get started!
Different Types of Cryptocurrency Scams?
There are different categories of cryptocurrency scams depending on the nature and means cybercriminals use to run their defrauding operations. They devise new ways, schemes, and plans to defraud innocent people to steal their hard-earned money, and breach their privacy and security. Here are some types of cryptocurrency scams based on the means they use to carry out cyber attacks:
Spoofed Websites
Fake crypto websites that mimic legitimate ones are one of the most common practices in cryptocurrency scams. Black Hats create fake versions of official sites with similar domain names with slight variations. These varied domain names confuse the target and visit the website to access their accounts. As soon as the user clicks on the site link, a fake login page appears, having the same look and feel as the official site. Taking the site for real, the user enters all the details in the appearing window and hits the login button. As soon as it is done, all the information goes to the cybercriminals. It is highly important that you double-check the site URL and domain name before entering information into it.
Phishing Attacks
Phishing attacks are other common tactics fraudsters use to carry out a cryptocurrency scam. With the phishing attacks, they target a person and steal sensitive information such as crypto wallet keys, transaction passwords, and other login credentials. The emails contain URLs that redirect users to unsafe websites. These sites are designed to steal personal information and account credentials that are important to run cryptocurrency accounts online. When individuals visit these sites, they are asked to fill out important information that leads to crypto-frauds.
Giveaway Scams
In giveaway scams, fraudsters convince users with huge returns and benefits if they give away their cryptocurrency to them for a short time. Scammers offer a solid investment plan promising the multiplication of the investment return in a short time. They can give reference to international market volatility and an increase in the value of investment due to specific market conditions. But all of this is a fake narrative that scammers use to manipulate innocent people into giving away their digital currency. Their aim is to get personal information and steal money. Once they have what they are after, they leave the scene without leaving any trace. The victim keeps waiting for the benefits and returns, but he doesn’t even get what he gave away.
Ponzi Scams
Ponzi scams are unique examples in which scammers approach people with beneficial investment schemes. They ask people to invest their digital currencies in an online business scheme, and it will give them a consistent income over a limited period. The investment is not large but significant. In these schemes, they encourage people to create chains by encouraging their near and dear ones to join the scheme and create a constant income source for them. The participants are paid profits from new investors instead of trading, and they are encouraged to join others in the same scheme. But when new participants do not join, the scammer collapses the scam and runs away with all the money.
Celebrity Endorsement Frauds
In this type of cryptocurrency scam, people run endorsement campaigns in the name of famous people, businessmen, and social influencers to promote fake currency, create hype around it, and attract investors. In this process, they use high-end websites, brochures, bonuses, perks, and rewards to tempt people to invest and buy fake currency. People become easily attracted to these schemes, and they start buying fake cryptocurrency, paying huge amounts. When scammers have significant amounts, they take all the money, cut all ties, and run off with the money.
Blackmailing and Extortion
Some scammers approach people and blackmail them, claiming that they possess sensitive data that includes media files such as videos, audio, and online data of visiting sexual content. They threaten to reveal this data in the public domain if the target does not pay them a ransom. Typically, these bad actors ask for payments in cryptocurrency so that no one can track them.
Cloud Mining Scams
Cloud mining scams are fraud schemes in which scammers establish fake cloud mining companies to steal money from people by selling fake crypto mining services. They offer cheap remote services with large mining farms and offer packages with attractive daily or weekly returns. The charges look easy and promise a convenient experience. But all the setup is fake, and when they are used to mine the coins, they prove useless and ineffective. But people who look for cheap solutions with big benefits often fall for these schemes. They buy them, paying a significant amount, but in the end, lose all their invested funds. When users try to withdraw their earnings, scammers ask for extra fees or block the withdrawals.
Fake ICOs
ICO stands for initial coin offerings. It is a scheme in which new crypto companies offer reward coins to new participants to promote their brand and attract more people to join them. The company encourages the participants to make investments and add more cryptocurrency to their accounts to earn more profits. Scammers create fake ICOs to attract investors who are looking to make easy money in a short time. They create professional-looking websites, whitepapers, and social media pages, and promote them as the new revolutionary coin. But as the investments increase, the users stop getting rewards, and after some time, the entire company goes bankrupt, leaving all the investors in loss.
How to Identify a Cryptocurrency Scam?
Fraudsters and fake financial advisors offering lucrative schemes to people to earn easy money are widespread in today’s digital world. They use all the tools and tactics to deceive you and steal your money. It is important to identify these thieves and protect your digital assets. If someone is contacting you using social media platforms, messaging apps, and unknown phone numbers, and promising you to earn huge amounts with small investments quickly, then it can be a scam. You have to stay awake and alert while dealing with these entities. Here are some key indicators that can help you identify a cryptocurrency scam:
Unbelievable Promises
- Claims of guaranteed high returns with no risk are a big red flag.
- The crypto world is highly volatile. Hence, no legitimate agency can promise constant profits.
Fake Celebrity Endorsements
- Scammers impersonate well-known figures to promote crypto giveaways or investments.
- Do not take their word for granted when someone is approaching you and convincing you about any crypto-investment.
- If you are planning any crypto-investments, then verify the endorsements via official sites.
Unsolicited Messages
- Be cautious of unexpected emails, social media messages, or texts encouraging you to buy cryptocurrency.
- Legitimate platforms rarely reach out to users this way. Double-check before you make any investment.
Phishing Websites and Links
- Fraudsters create websites that closely resemble legitimate platforms.
- Double-check URLs for slight spelling differences and secure padlocks (https://).
- Do not make any investments using third-party platforms or random URLs.
Unregulated Platforms
- Crypto scams take place via exchanges or wallets that do not have proper regulatory approvals.
- To avoid the loss, it is highly important that you stick to trusted and licensed platforms.
Pressure to Act Fast
- Scammers push for immediate action to prevent victims from thinking carefully.
- If someone manipulates you to take immediate action, then you must not act impulsively.
- You must avoid offers that require instant action and limited time urgency.
Rug Pulls and Fake Projects
- Scammers use new crypto-tokens or projects to make things look legitimate.
- But when people start investing on a large scale, fraudsters collect all the money and leave.
- Before investing, verify everything via whitepapers, developer backgrounds, and online reviews.
Requests for Private Keys or Wallet Information
- No one offering support service will ever ask for your private key, seed phrase, or password.
- Do not share your private keys or wallet information with anyone offering any kind of
support services.
How to Prevent Cryptocurrency Scams?
Cryptocurrency is often seen as a fleeting dream of wealth in the digital age. No government fully endorses or officially backs this form of currency. It is a highly vulnerable and volatile currency that only exists in the virtual world. You do not find it anywhere in the physical form. Cybercriminals exploit this fact to steal money from people using digital channels. They beguile individuals by approaching them using different online channels. Their aim is to make as many personal gains as possible by extorting money from innocent investors. It is highly important that you apply best security practices to protect your digital assets from fraudsters. Here are some effective tips that help you ensure your own safety regarding cryptocurrency:
Use Trusted Exchanges and Wallets
- Use only reputable platforms for exchanges like Binance, Coinbase, or Kraken.
- Use hardware wallets (like Ledger or Trezor) for long-term storage instead of online wallets to keep your keys and credentials secure.
Double-Verify URLs and Apps
- Beware of phishing sites mimicking legitimate crypto platforms.
- Ensure the site has `https://` and is spelled correctly.
Keep Your Private Keys Secure
- Make sure you never share your private keys, seed phrases, or passwords with anyone.
- No authentic or legitimate service asks for personal information & login details from you.
Use Two-Factor Authentication Services
- Double down on your security using 2FA services on exchanges and wallets.
- Use authentic and trusted apps like Google Authenticator or Authy for better security.
Don't Greed to Acquire Quick Wealth
- Don’t believe in promises of guaranteed returns, huge profits, or “risk-free” investments.
- Scammers usually use urgency to make you make quick decisions about investments.
Verify New Projects Before Investing
- Check for a legitimate whitepaper, active development team, and community discussions.
- Avoid projects without transparency or verifiable credibility.
Beware of Social Media Scams
- Fraudsters may mimic celebrities or influencers offering fake giveaways to lure investors.
- Before you make any payments, make sure to verify account details and investment promotions.
Educate Yourself Regularly
- Stay informed about the latest types of scams in the crypto world.
- Follow trusted sources like CoinDesk and security blogs.
Report Suspicious Activities
- If you are scammed, report it immediately to platforms like your exchange or local cybercrime authorities. Cybersecurity agencies will take immediate action to tackle this issue and trace it back to the real culprits.
