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In recent years, cryptocurrencies have become the new gold rush. While the success of Bitcoin investors, who earn thousands or even millions of dollars, is difficult to replicate, it is still possible.

However, the popularity of cryptocurrencies has a serious drawback. Everyone wants to invest in digital currencies and make huge profits. This is where scammers come in. Statistics show that cryptocurrency scams are the best way to lose money in the cryptocurrency world.

However, this doesn't mean users should stop investing in cryptocurrencies altogether. We've prepared this article to help you spot and avoid cryptocurrency scams. Read on to identify the most common scams.

The Most Common Cryptocurrency Scams

Analyzing a token is crucial before investing in a particular cryptocurrency. For example, you can browse websites that offer valuable cryptocurrency data by checking out ICO holders.

However, it's also important to learn more about various common scams. If you know what to watch out for, you should be able to avoid being robbed of your money by scammers. Here are some of the most common scams of 2022.

Phishing Scams

Phishing is one of the most popular methods of defrauding internet users. It's no wonder scammers use phishing in cryptocurrency fraud. The idea behind phishing is simple: it requires social engineering to trick users into revealing their personal information.

Suppose scammers obtain your personal or financial information. They can access your account! For example, one user lost over $50,000 to a phishing scam after providing their personal information on one of the most popular e-wallets.

Scammers tend to create fake websites that look like legitimate trading platforms. They often use popular platforms but change their names, making them look similar but not identical. The platform's address is different, and its internet connection is always insecure due to the lack of an SSL certificate.

Some scammers send emails to potential victims containing links to these fraudulent platforms. The victim believes it is a legitimate company because it has a recognizable name. Therefore, they click the link and enter their financial information, such as private keys, to access the cryptocurrency.

What happens next: The scammer logs into the victim's account and sends the cryptocurrency to their wallet. From that point on, it is impossible to recover the funds. Therefore, avoid clicking on links in emails. Always make sure you use legitimate, not fraudulent, websites.

Cryptocurrency Market Manipulation

Typically, criminal groups purchase a specific type of cryptocurrency. Then they go on social media and start promoting the coin to attract investors' attention. People start buying the coin to increase its value. Then the scammers sell the currency at an even higher price.

This is similar to wild stock price fluctuations. See this article for a combination of this scheme and a romance scam.

Investment Scams

Truth be told, we all want to find the "next Bitcoin." This means most of us want to invest in a cryptocurrency whose price will skyrocket like Bitcoin's. This is why some of us take huge risks investing in unknown cryptocurrencies, hoping their price will explode in the future.

Scammers exploit these people's desire to invest. They create fake projects that promise to change the world. Naturally, people believe that investing in these projects will bring them future benefits, as the cryptocurrency's value increases. Unfortunately, this never happens. That's why it's always crucial to check the background of companies offering substantial profits.

Mobile App Scams

Another scam is similar to phishing. Scammers create fake mobile apps impersonating well-known cryptocurrency exchanges. Unsuspecting users download and install the app, unaware that it's a scam. The app then requires a login and password to access the cryptocurrency.

Another common consequence is the phone becoming infected with malware, which copies all data when accessing various applications, including online banking apps.

Mining Scams

The most common scenario is when users join a mining pool or use cloud mining. Any mining pool charges a fee, but it's still possible to earn cryptocurrency through the combined efforts of miners. Fake pools charge a fee and then disappear at the end.