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Transparent Crypto - A nightmare for crypto imposters

The Crypto world is as grey as any other. Today, it seems like a race between the crypto positives and negatives. You can read the latest startup news for more updates on the cryptocurrency industry.

Photo by Dylan Calluy / Unsplash

Cybercriminals have webbed $4.3 billion from cryptocurrency exchanges, users and investors.

CipherTrace, a Blockchain security company, reported that up till now in 2019, illicit activities in the crypto world comprising of thefts, scams, and other defalcations of funds from cryptocurrency users and exchanges had followed losses of around $4.3 billion.

In the first quarter of the year, Hackers robbed more than $124 million from trade platforms, totaling the theft of $227 million. Further, Bitfinex lost a massive amount of $851 million. According to the study, the smart bad actors primarily used BTC for trading drugs and funding terrorism, while other crypto coins like ETH, LTC, XMR, BCH, and DOGE were broadly employed for dark markets and malware attacks.

The Crypto world is as grey as any other. Today, it seems like a race between the crypto positives and negatives. You can read the latest startup news for more updates on the cryptocurrency industry. As much ascends cryptocurrency acceptance and usage, that much increases the crypto crimes and scams. To learn more about Blockchain Technology, you can read this article on What blockchain is and understand the basic concepts of blockchain & cryptocurrency.

The fancy Ponzi PlusToken

CipherTrace cited the PlusToken scheme as the most extensive disaster that defrauded the users and investors of around 70,000 Bitcoins and 800K Ethereum. When summed up, the Ponzi scheme looted an overwhelming number of nearly $2.9 billion from the people of China, Japan, and South Korea. However, the scammers couldn’t escape. The Vanuatu authorities arrested the six Chinese citizens associated with the hoax.

The transparency of cryptocurrencies has proved to be a gallant knight. Although the swindles invade the digital world, a significant number of them are tracked, and people behind them are busted.

The best forgers in the sentence.

On 10 September, the Portuguese Judiciary Police and Europol tracked down and captured one of Europe’s most significant falsified gangs. In action since 2017, the group of five sold fake notes in exchange for the crypto coin King, Bitcoin. The cops seized almost 70,000 euros in counterfeit banknotes, and as reported, 1.3 million euros were sold in the past two years. According to the authorities, the forgery was of some best quality exhibiting traits such as watermarks and holograms.

The real fake

The UK is evolving as one of the crypto crime hubs. The frauds within the digital currency industry pose a real threat to investors. FCA stated almost $34.4 million was lost to scams in the forex and cryptocurrency sector in the 2018-2019 fiscal year. In June 2019, Europol, in union with the UK’s South West Regional Cyber Crime Unit and NCA, arrested six people responsible for a bitcoin scam worth $27 million.

The crime ring, including five men and one woman, originated a “typosquatting” hack that entails the creation of a fake website and an identical web address. Such scams may prove very perilous as people cannot realize they have stepped onto another platform and entered their credentials, unknowingly presenting the information to the hackers. The cyber theft majorly targeted bitcoin users, and over 4000 people in 12 nations fell victim to this foul play.

Too young for crypto fund

Japan faced a massive storm of cryptocurrency theft when $610 million in digital money was stolen from the citizens last year. Although no crooks were caught then, this year, the Japanese police succeeded in detaining an 18-year-old for stealing $130K worth of crypto coins.

A resident of the city Utsunomiya, the scammer profited on a security issue on Monappy, a crypto wallet network, and sent multiple transfer requests of Monacoin virtual currency to his private address. Post claiming the coins, he moved them to other exchanges and later converted them into traditional money to buy a smartphone and other gadgets.

Unknown to the fact that he affected over 7735 users, the Japanese adult swindler currently faces computer fraud and concealment of criminal proceeds charges. Simultaneously, Monappy has been out of service since September 2018.

Besides this, Japan’s Bitpoint, a crypto trading platform, has suffered the loss of $32 million of funds after being hit by a hack. The scam targeted the hot wallet, which involved five crypto coins, including Ripple, Bitcoin, and Bitcoin Cash.

The fraudster brothers

Crypto exchanges are a lucrative aim for hackers. The Israeli police cyber unit caught two brothers, Eli and Assaf Gigi, for committing a multi year phishing scheme and engaging in the Bitfinex hack of 2016. The siblings from Jerusalem stole around $100 million in cryptocurrency and hacked virtual wallets that possessed thousands of Bitcoins.

They enticed investors from crypto trading forums and accumulated the traders’ login and wallet data. Next seen were the funds withdrawn and transferred to the brothers’ accounts.

The miner of scams

On 21 May 2019, Dutch police apprehended a former entrepreneur for fraud, money laundering, and forgery. The man was the director of firms where people could buy computers for mining. The sharp bad brain conned investors into a fake bitcoin mining operation. Where people thought of gaining money from the mining of BTC, Barry van Mourik had commenced his fraud.

The 33-year-old operator of a mining firm accrued funds and initiated a scam worth $25 million. Around 100 investors invested 100 million euros. When examined, the authorities figured that mining computers were never actually purchased, and the hacker had spent the money on all kinds of luxurious things such as cars, travel, gambling, and more.

Sad for patrons, sadder for crooks

India, making moves in giving a hard time to Crypto enthusiasts, is not holding back in proffering the same to the crypto criminals. In June, the Madhya Pradesh Police busted an international gang that tricked naive victims into a fraud of Rs 50 crore in the business of outlawed cryptocurrency.

The Special Task Force (STF) arrested a couple who was the bigwig of the swindling group. The accused had set up a sham firm on the fake website of the Hong Kong share market with a server in Jaipur. The case came to light when one of the victims reported to police the fraud. When further investigated, a transaction worth Rs 3 crore was detected from the captured account. They would lure investors into investing in digital money by claiming to multiply their investment.

In February, a group of four was taken into custody for carrying out a crypto racket that amassed an estimated Rs 100 crore by looting people in Mumbai, Surat, and other states. The crooks had launched a cryptocurrency dubbed “Cashcoin” and enticed investors by assuring them to double their funds.

Spain suffered the crypto fraud pain.

Spanish law enforcement arrested 35 people for counterfeiting banking cards and laundering the benefits attained through bitcoin. As per reports, the organization had earned more than 600,000 euros and over one million. The group operated via three paths: phishing – through email, skimming – cloning the physical cards, or Bin attack fraud – obtaining credentials from credit card receipts.

Before this, eight people were caught performing a money-laundering plot involving cryptocurrencies.

The innovative scammers

This year, Dubai cracked the first case of Bitcoin crime. An Asian had set up a profile posing as a businessman interested in buying Bitcoins and duped three GCC residents by stealing $102,179 from them. He attained their passwords and transferred the amounts to his accounts.

Previously in March, Dubai police officials charged three Pakistani citizens for robbing approximately $250,000 from a group of Chinese investors. The Pakistani men lured the Chinese businessmen into a purchase of millions of dollars worth of Bitcoin. When convinced, the businessmen arrived at the apartment of the scammers, where they were tied and physically restrained. Each of the accused is sentenced to imprisonment.

In addition, the scammer stands top and alone in North Korea. The nation is on the road to looting every section of crypto exchanges worldwide; not the public but the government rides the crime wheels.

Cybercrimes though an unwanted part of the internet, yet subsists. It is not the cryptocurrency that carries out these fraudulent activities but the people who take the wrong track to earn easily. We cannot certainly halt or seize these criminal minds but can try to stay alert. To avoid being conned, keep an eye out for symptoms like Useless tokens, company offering guarantees, high returns, unrequested offers to invest in ICOs, and unreliable claims about price growth.