Cryptocurrencies might be just a decade old, but the sector is still plagued by its share of ransomware and Ponzi schemes. Crypto crime has continued to grow at an astonishing rate causing investors and enthusiasts to grow frantic about the industry.
Today we will discuss some of the biggest Ponzi schemes, active ransomware strains, and how to protect your self from such activities.
Crypto crime: Ponzi schemes
The title “Ponzi scheme” is a phrase used to talk about a project in which investors are lured towards a non-existent enterprise that provides quick returns. The project works by generating revenue for old investors with money from new investors so that they invite more people to invest in the project.
Some of the biggest Ponzi schemes in the crypto industry are the OneCoin scam, BitConnect, and PlusToken. The three crypto crime organizations collectively defrauded more than $11 billion from investors with OneCoin alone causing the loss of nearly five billion dollars.
So how do you spot a Ponzi Scheme? Any project offering unrealistic returns along with bonuses for inviting more users is likely a Ponzi scheme. Never invest in projects offering monthly returns of 30-40 percent and/or annual returns way higher than 100 percent.
Ransomware files are executable files that encrypt data on the victim’s device and require him to pay a ransom to get his data back. Attackers send emails with a link or attachment that can trigger the ransomware when opened.
You can protect yourself from ransomware files by avoiding emails that come from unknown origins. Use a trusted antivirus application to scan any attachments and downloads before opening them. If possible, try to avoid opening unsafe files on a device you store your financial credentials on.
Other forms of crypto crime may involve fake applications imitating legit financial apps to steal victims’ financial credentials.