Crypto crooks scam billions as pump and dump programs go digital

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Bloomberg identifies a variety of cryptocurrency scams, including a “carpet pull,” where the creators of a new cryptocurrency suddenly cut and run.

“The old-fashioned, newly dubbed crypto Ponzi schemes have also defrauded billions of people,” Bloomberg adds. And a 35-year-old crypto trader living with his parents (“trading coins like a full-time job”) also tells them about “honeypots,” where creators of a coin see an increase in value. – then temporarily disable selling for other holders: this might sound like a joke, given the recent crypto meltdowns, but money is at stake here. Billions – real billions – are stolen every year through various cryptocurrency-related scams. The way things are going, it will only get worse. Back in the Dark Ages of Wall Street – six, 12, 18 months ago – these kinds of shenanigans were mostly associated with brokerage houses like the one depicted in the 2013 movie The Wolf of Wall Street. In those happy days before GameStop, Dogecoin and the rest, the schlubs on Long Island might be throwing some ridiculous over-the-counter stocks at the gullible …

Tokensniffer, aptly named for Shit Coins, claims to have tracked 42,071 tokens and 2,250 scams or hacks. It was June 16. Over 200 supposed bites were logged by users in the first two weeks of June alone … His website pulls data on new tokens even from popular social media channels and scans the source code … A ” The odor test program “searches for vulnerabilities. Even existing token clones are often a red flag. The most recent scams – the site reported 450 in a recent 30-day period – were honeypots. These tend to be easier to spot due to their code, says the creator of Tokensniffer. Carpet prints are more complicated.

Aside from these so-called guarantees, more and more people are being ripped off. So far this year, more than $ 2.6 billion has been seized, according to Chainalysis, a New York-based blockchain researcher. This figure does not include a giant Ponzi scheme that has just been revealed in South Africa. Local authorities estimate the transport at $ 3.6 billion worth of Bitcoin. Scary as it all sounds, these numbers actually represent a marked drop from 2019, when scammers walked away with around $ 9 billion. But here’s a key difference: the large number of people who get screwed. With a few exceptions, most crypto scams seem to be getting smaller and smaller. This is the good news. The bad news is that there are more and more people are getting bitten. From 2019 to 2020, the death toll jumped 48% to around 7.3 million, a figure approaching Hong Kong’s official population. Between the last three months of 2020 and the first three months of 2021, the number of unique scams increased by almost 18%, to 1,335, according to Chainalysis.

Michael Burry, of “The Big Short,” warned that this could all go wrong. It is estimated that 10,000 new coins were minted this year. Who can say how many will turn out to be impostors? So many pieces of shit are flying out there, and the prices can be so volatile, that a lot of people can’t even tell if they’ve been scammed … Sure: no one complains when they earn money. ‘silver. It’s when people start to lose money – and lately a lot has been – that they cry out that they’ve been taken. “A decade after the creation of Bitcoin, regulators are still wondering how to control cryptocurrencies,” Bloomberg adds, “as they operate without governments or central banks”.

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