Cryptocurrency has skyrocketed in the past few years. While its rapid growth is good news for people investing in it, it’s also led to a massive increase in scams. Social media crypto scams have grown almost as fast as cryptocurrency itself.
Scammers like crypto because these transactions may not have the same legal protections and typically aren’t reversible. All the excitement around cryptocurrency can also make people more susceptible to these scams, especially if they’re new to crypto. Social media provides the prime hunting ground for these scammers.
The Federal Trade Commission (FTC) says social media scams accounted for 25 percent of all fraud losses in 2021. Many of these involve cryptocurrency—either asking for crypto payments or promising a bogus crypto investment opportunity.
Facebook and Instagram are the most common places where these scams happen. Topping the Instagram Bitcoin scammer list is online shopping fraud, where an account sells something for crypto but never delivers the product. Some of these fake ads—which account for 45 percent of all social media scams—even impersonate legitimate retailers.
Impersonation is a common theme in the Facebook and Instagram Bitcoin scammer list. Scammers often pose as celebrities, even hacking into their real accounts. They’ll then post about an investment opportunity or giveaway, which looks like it’s coming from a trusted source. Users will give away their crypto or send these accounts their crypto wallets, only to get nothing in return.
Other common social media crypto scams include fake initial coin offerings (ICOs) or NFT projects, asking for investors when there’s no actual project. Other scammers pose as potential romantic interests or impersonate family members. As reported by Fortune, experts from Chainalysis found that crypto scammers in 2021 made over $14 billion, an influx attributed to the growing popularity of decentralized finance (DeFi).
How to Identify a Crypto Scam
These crypto scams can be hard to spot at first, partly because awe-inspiring success stories do happen in this field. In one such instance, Twitter’s founder, Jack Dorsey, sold an NFT for almost $3 million, and early Bitcoin adopters have made a lot of money. Still, there are usually a few telltale signs of a scam.
If a seemingly legitimate source is promising something that sounds too good to be true, check their account first. If there’s no checkmark to confirm it’s a verified account or the user has a lower follower count than they should, it’s probably a fake account. Of course, hackers can take over verified accounts too, so just because a profile is legit doesn’t mean its posts are.
Remember that if a crypto post sounds too good to be true, it probably is. Bold claims without any explanation or details, free giveaways, and a guarantee to make your money back are all red flags. Any guarantees should raise the alarm because cryptocurrency is so volatile that you can’t really guarantee anything.
In general, it’s best to never send money or information to someone you haven’t met in person. If you have met the person and they insist you send money through crypto, wire transfer, or gift cards, their account is probably hacked.
How Do I Report a Bitcoin Scammer?
The FTC takes cryptocurrency enforcement seriously, especially regarding these scams. Here’s how users can report a Bitcoin scammer if they encounter one on social media.
First, take note of all the details you can about the scam, but don’t interact with the scammer. Then, go to the FTC cryptocurrency enforcement and reporting tool, and click Report Now. The form will provide guidance for the following steps.
It’s also a good idea to report Bitcoin scammers to the social media platform they’re on. Facebook, Instagram, and other social sites have buttons next to profiles and posts that let users report them. If the report has enough evidence or enough people report the user, the site will likely disable the scam account.
Social media crypto scams are everywhere. If more people learn how to spot them, then the FTC and social platforms can crack down on them. While these scams won’t likely go away entirely, they may decline, or at the very least, they won’t trick as many people.
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About The Author
Shannon Flynn (70 Articles Published)
Shannon is a content creator located in Philly, PA. She has been writing in the tech field for about 5 years after graduating with a degree in IT. Shannon is the Managing Editor of ReHack Magazine and covers topics like cybersecurity, gaming, and business technology.