The US Securities and Exchange Commission (SEC) has warned of an increase in the number of cryptocurrency scammers looking for potential victims on social media.
According to an SEC press release, cryptocurrency scammers are playing on investors’ fear of missing out. Therefore, the regulator advised the public to be more skeptical of any statements regarding investments and not to make decisions solely on the basis of information published on social networks. People considering investing in traditional assets or cryptocurrencies should first understand how investments work.
You should not completely trust the data presented on the sites of cryptocurrency projects, the SEC warns. Fraudsters can post fake screenshots with high incomes on them in order to involve as many investors as possible in their schemes. Therefore, you should conduct your own analysis of projects and study the history of their development. You can check for licenses and regulatory registrations at Investor.gov.
“Promising high returns on investments with little or no risk are classic signs of fraud. Be careful if someone offers you an “exclusive” investment opportunity by providing inside or confidential information. Back out of a trade if someone encourages you to invest through a third party site or app as there may be a scammer behind it. Be especially alert if you are required to make an investment in bitcoin or other crypto assets,” the SEC warned.
Among the most common schemes for defrauding investors, the agency called “pump and dump” – market manipulations to increase the rate of a particular cryptocurrency and its subsequent collapse, as well as actions on behalf of well-known individuals and companies. Last week it became known that the attacker tried to impersonate the director of public relations of Binance Patrick Hillmann (Patrick Hillmann). He conducted “negotiations” with representatives of cryptocurrency projects regarding listing on the exchange, demanding remuneration from them.
As a reminder, the SEC recently expanded the whistleblowing reward program for potential securities law violations in the cryptocurrency industry.
Source: Bits
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