By Markus David
Director of Professional Services
MyChargeBack
Cryptocurrency has been around for less than a generation. Nevertheless, it has transformed the way we think about money and how we spend, trade, and even lose it.
Whether we’re devoted crypto fans who keep most of our funds on decentralized platforms or crypto skeptics who blanch at the mention of central bank-backed digital currencies, the crypto revolution has affected us all.
It’s clear that with digital currencies, history is happening all around us. It’s a good thing, then, that chainplay.gg is chronicling this history with startling facts, caveats, and milestones in the crypto sector.
The Crypto Scam Disaster
Many people view cryptocurrency as synonymous with fraud. In fact, it’s not unusual to hear the question, “Is crypto a scam.” Although blockchain technology isn’t inherently illegal or morally wrong, there’s no secret that the anonymous nature of crypto has attracted many cyber criminals.
The following are some key crypto scam facts uncovered by the Chainplay.gg report:
- In 2022, a record $12 billion was stolen in 436 crypto scam incidents. To understand the impact of these numbers, that’s the equivalent of $1.4 million lost every hour in the past year. This represents a 45% increase in losses and a 360% rise in crypto scam cases over 2021.
- 2023 is on target to be an even bigger year for crypto scams, with $16 billion in losses. The target for 2025 should top $20 billion.
- June is the worst month for crypto crime, with $5.7 billion stolen in 76 incidents in the last decade
Turkey and the United States the Most Common Crypto Scam Targets
The year 2022 was a difficult one for Turkey. An earthquake killed 40,000 people, injured hundreds of thousands and left millions homeless. The last thing a population can afford, after such a severe natural disaster, is steep financial losses.
Although no one can prevent an earthquake, crypto scam losses are preventable. Turkey, unfortunately, lost $2 billion to crypto scams in 2022. It is the leading country in terms of total crypto scam losses.
However, the United States leads the pack in the number of crypto scam cases. This is followed by the United Kingdom for the highest total number of people who lost money to bitcoin frauds.
Which Platforms Are Most Often Targeted by Crypto Scams?
Although people are often wary of decentralized platforms, actually, the greatest losses in 2022 were on CEX or centralized crypto exchanges – a total of $13,583,290,003.
After this, Bitcoin losses were the highest at $4,965,178,400, followed by Ethereum at $3,587,795,817. However, the number of ETH cases, 169, was much higher than the 87 involving BTC.
The largest number of crypto scam cases were on BSC or Binance, but the losses, at $917,270,192 were more modest.
What Were the Top Crypto Scams of 2022?
According to Chainplay.gg, “rug pull” scams were by far the most destructive crypto frauds in 2022. Rug pull scams, which stole $9,397,354,001, involve pushing a certain trade or encouraging people to buy a new coin or token only to pull the rug out of them by abandoning the deal.
This is another term for a “pump and dump” fraud in which value rises on hype alone, the scammers cash out and leave everyone else in the dust.
The second most common crypto fraud, which was responsible for $2,451,972,910 in losses, is the “flash loan attack.” This happens on DeFi platforms when the fraudster borrows a huge amount of cryptocurrency and then uses these funds to manipulate prices on the platform.
The third most financially dangerous type of crypto scam on these platforms is “access control,” which robbed $1,463,897,577 from consumers. “Access control” is another name for user passwords or other forms of fake identification to gain access to crypto wallets or accounts.
Finally, phishing, a deceit that involves farming information from people by adopting a fake identity, stole $751,123,195 in 2022.
However, beyond the top four, there are plenty of crypto scams to go around. Other crypto scams robbed $15,455,882,805 and were responsible for 200 crypto frauds.
How Can I Get My Funds Back from a Crypto Scam?
After hearing the bad news, the good part – crypto recovery is possible. However, it’s important to have crypto experts at your side. MyChargeBack has extensive experience, crypto trace technology, and bitcoin forensics methods to unmask your stolen crypto on the blockchain.
MyChargeBack Will Get You Started with Crypto Recovery
If you have lost money to the ”financial hardship” scheme, seek fund recovery assistance right away. Consult with MyChargeBack experts and get started with your fund recovery claim. We have extensive knowledge and working relationships with regulators and more than 450 law enforcement agencies around the world, as well as solutions that can improve your prospects of getting your funds back.
