Crypto scams and hacks are growing this year as scrupulous individuals work to make a quick buck in the industry.
Total Value Hacked hits $8.56 billion
Data shows that the total value hacked (TVH) has jumped to over $8.56 billion in the past few years. Most of these hacks, or $6.03 billion, happened in the Decentralized Finance (DeFi) industry, while the rest happened in bridges.
The most recent hacks happened in Astroport, DeltaPrime, ETHTrustFund, Rho Markets, WazirX, and Lifi Finance. Meanwhile, WazirX’s hack was notable since it was one of the biggest crypto exchanges in India. The hackers stole over $234 million worth of tokens. Bittensor users lost over $8 million, while those in BtcTurk lost over $54 million to hackers.
Meanwhile, the number of scams in the crypto industry is growing. On Thursday, Alvin Bragg, the District Attorney in New York, charged Michael Lauchlan with stealing from Coin Dispute Network (CDN) customers, a sham crypto asset recovery firm.
According to Bragg, Lauchlan deceived customers that he would help them trace their lost or stolen cryptocurrencies. His firm received the fees and also extracted additional Ether tokens. Bragg said:
“By manipulating customers with false promises and pocketing a fee, Michael Lauchlan allegedly engaged in a scheme that defrauded dozens of people and stole from at least three New Yorkers. This investigation is ongoing.”
The DA charges came a day after the Securities and Exchange Commission (SEC) charged Nader Al-Naji, the founder of BitClout, with fraud and offered unregistered securities. The SEC alleged that Naji raised over $257 million from investors like Sequoia, Coinbase, and a16z.
According to the SEC, Naji promised his investors that proceeds from BitClout’s BTCLT token would be used to run the operations. Instead, he used the funds to pay for luxury items, including a $7 million mansion in Beverly Hills.
Read more: Scam Crypto Site Thwarts Murder-for-Hire Plot in New York
Other top crypto scams charged by the SEC
The SEC has announced other crypto-related scams this year. It recently charged 17 individuals in a $300 million crypto asset ponzi scheme through CryptoFx. In another case, the SEC charged Brenda Chunga, known as Bitcoin Beautee, for running a $1.7 million Bitcoin HyperFund pyramid scheme.
It also charged Brian Sewell and Rockwell Capital Management for fraud that cost customers over $1.5 million.
Sadly, most crypto scams are never reported, and their creators get away. One of the fastest areas of scams is token sales, where anonymous people raise money and, at times, fail to list their tokens.
This trend will continue because the crypto industry is global in nature, mostly unregulated, and has huge potential gains, as we saw with meme coins like Popcat and Dogwifhat.
Read more: Scam Alert: Mavrodi’s Pyramid Scheme, Which Ruined Millions, Enters Crypto
