Cryptocurrency thieves steal hundreds of millions of pounds from victims

Cryptocurrency thieves steal hundreds of millions of pounds from victims

The industry is still reeling from the collapse of the FTX exchange.

In the UK, where it has gone up by a third in a year, cryptocurrencies theft is rampant outside of FTX. According to police data cited by the Financial Times, thieves stole hundreds of millions of pounds from victims.

The UK police unit Action Fraud received reports of 226 million $273 million in financial losses from October 2021 to September 2022. That's a 32% increase over the same time in the previous year. A 16% surge has been reported with 10,030 reported incidents.

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The trade group for financial services, UK Finance, claimed that the findings were a part of a larger epidemic of fraud as people's financial habits changed online.

Fraud in general increased by 8% yearly to 1.3 billion $1.56 billion in 2021.

In May, there were 33 million $39.6 million in reported losses, the month when the algorithmic stable coin Terra LUNAUSD collapsed, having an impact on several other cryptocurrencies and businesses linked to it.

A growing number of victims of rug pull scams have fallen as a result of the fall of the value of cryptocurrencies, according to law firm Pinsent Masons.

These frauds include cryptocurrencies developers quitting a project and escaping investor money.

A report by the BBC said that 2.5 million $3 million was stolen from retail investors last November by the developers of a token that offered access to an online game inspired by the Netflix series Squid Game.

Hinesh Shah, a forensic accountant at Pinsent Masons, said that fraudsters always aim to prey on less experienced investors by promising huge returns whenever times are tough. There are huge sums that some investors made during the boom, which can be particularly potent for smaller investors who may be desperate to make a quick buck, according to the scams involving cryptocurrencies.

Fake endorsements from famous people are another scam.

The Federal Trade Commission said a scammer pretending to be Tesla TSLA CEO Elon Musk stole millions of dollars from US consumers in criptocurrency thefts last year.

The UK authorities have warned that similar scams are taking place in their country.

People are falling for pump-and-dump schemes, in which thieves fudge coin prices before selling them to retail investors just before the market drops.

Consumer investment in high risk asset classes has been a source of concern for the Financial Conduct Authority on numerous occasions.

The guidelines for businesses that promote these products in August were issued by the regulatory body and prohibited incentives like refer a friend bonuses.

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