“Bitcoin is dead” they all cried as it plummeted from its $20,000 per Bitcoin peak in Dec 2017 to just below $4,000 in Dec 2108, an 80% loss in value. It sounds awful but, in some ways, we were pleased about this as the number of scams around Bitcoin decreased as many would be investors ran for the hills. But this year Bitcoin is back, it has increased in value by more than 200% and with it the fraudsters are going into overdrive. Websites falsely claiming celebrity endorsements, free “Bitcoin Collector tool”, free coins for endorsing/referring users, fake exchanges/wallets and good old phishing are increasing even faster than the value of Bitcoins! In 2017 80% of all Initial Coin Offerings were scams and their total losses were over a £1 billion. In 2018 the FCA dealt with a 200% increase in crypto currency fraud cases.
THE FINANCIAL CONDUCT AUTHORITY ONLY REGULATE SOME CRYPTOCURRENCY DERIVATIVES AND NONE OF THE CURRENCIES THEMSELVES. THAT MEANS THAT MOST INVESTORS WILL NOT HAVE ACCESS TO THE FINANCIAL SERVICES COMPENSATION SCHEME.
Tips and Advice
- Research, research, research – check up on any firm you are thinking about using, use the FCA’s registry and their warning list as a starting point.
- Don’t be taken in by an impressive looking website/address – with the average loss on these crimes of over £10,000 the fraudsters have plenty of money to invest in a good-looking website.
- If you must buy some – research the “wallet” provider that will hold them, a simple Google search of “best digital wallet” and looking for a reputable source such as a major newspaper article is a much better approach than reacting to an advert/cold call.
- Avoid cold calls – cold calls are not the way reputable companies market their investment products, so don’t buy from a cold call!
- Read More – Read the FCA website on crypto currencies to better understand the risks..
- Still Unsure? – Join Reassura 0800 888 6400 and one of our fraud advisor’s will help you to stay safe
- To report a fraud – and receive a police crime reference number call Action Fraud on 0300 123 2040 or use theironline fraud reporting tool
Never miss a Scam Alert – Sign-up here, it’s FREE.