Two years ago, cryptocurrency scams were just emerging as a problem on BBB Scam Tracker, mostly a subset of investment scams. Better Business Bureau added cryptocurrency as a scam category in 2019, and according to a new report, it leapt to the second riskiest scam. Although employment scams remained the riskiest for the second year in a row, the most surprising data was this prevalence of cryptocurrency scams, with a median dollar loss of $3,000.
The report is based on data supplied by consumers, and uses BBB’s Risk Index, a unique algorithm that calculates exposure, susceptibility, and monetary loss to offer a more accurate assessment of scam risk. While cryptocurrency scams were relatively rare in eastern and southwest Missouri and southern Illinois in 2019, just eight were reported to Scam Tracker in the region last year, and they proved costly.
Consumers who contacted BBB Scam Tracker reported losing a total of more than $11,000. Cryptocurrency scams occur when virtual coins are purchased from, traded by, or stored with a person or exchange site that turns out to be fraudulent. Sometimes these digital assets are purchased as part of a fraudulent Initial Coin Offering, in which investors are scammed into paying money or trading digital assets for a company or product that never materializes.
According to BBB’s Risk Report, 68.5% of people reporting a cryptocurrency scam lost money, and nearly one-third of these losses involved cryptocurrency exchange site, C2CX.
