What to Know About Crypto Scams

Cryptocurrency companies have been entering the mainstream in recent years with online exchange companies advertising in sporting arenas, purchasing Super Bowl commercials and buying ads in television and radio streaming services. Along with additional media attention and mainstream popularity comes cryptocurrency scams becoming more and more prevalent. 

One such scam involves what is known as “pig butchering”. While the name is already quite grotesque, the scam may be even worse.

Scammers using this tactic use well-known methods like a relationship scam where the scammer creates a fake identity and works to earn a victim’s trust and companionship over time. Once the relationship is built, they begin suggesting cryptocurrency investment sites, which are actually owned and operated by the scammer themselves.

At this early stage of the operation, the victim usually plays it safe by investing a marginal amount; however, this only feeds the deception. The scammer recognizes that if they leave a trail of “proof” of returns, they’ll be able to butcher the whole pig instead of just the piglet, coining the scams name. As the victim sees their “profits” grow, they invest more and more into these fake platforms, often under subtle pressure from the scammer. After enough time and money has been invested, the scammer springs the trap and escape for the victim becomes impossible. If the victim attempts to retrieve their earnings, they’re informed they must pay an inflated amount.

Tens of thousands of Americans have become victims to these scams, with some losing millions. To help protect yourself, educate yourself on these scams and on any investing platforms, be cautious of any promises to “get rich quick” and never respond to unsolicited messages.

If, at any time, you feel you’ve been a victim of a scam, contact your local bank location immediately to help prevent or stop any monetary losses. You can also report scams to the Federal Trade Commission at reportfraud.ftc.gov.