One of the biggest cryptocurrency scams that is out there is Pig Butchering. Now I’ve talked a lot about that lately as it still continues to happen especially since cryptocurrency largely remains unregulated. I’m not saying to avoid cryptocurrency at all costs, but you do have to do research to see if it is for you and understand what it is all about.
I’ve talked about some recent Pig Butchering examples that included a woman from California who lost all her retirement, how an entire bank collapsed because of the actions of its CEO, and more recently how a Chinese tycoon, who was the leader of one of the largest Pig Butchering schems out there, has been caught. As you can see, Pig Butchering continues to be one of the worst cryptocurrency scams out there.
Pig Butchering isn’t the only cryptocurreny scam out there as there are quite a few other ones and believe it or not, I’ve fallen for a few of them. While I did lose some money, I’m very fortunate that it wasn’t very much, unlike others who lost a lot more. I will talk about the other crypto scams out there as well as at least three that I’ve fallen for.
Imposter & Give Away Scams
This is a big one and I had seen a lot of this in the past especially on YouTube and there also some recent cases. Anyway, let’s just say you’re scrolling through your YouTube feed and you catch something that says it is currently live streaming and it appears to be the President of the United States. Out of curiousity, you click on it to see what he is saying. He apparently is talking about how cryptcurrency is the future and that the United States will fully support it with legislation currently in Congress that will help regulate it.
Here’s where things get interesting. He might suddenly say that Bitcoin, or Ethereum, or XRP are crypto that has amazing potential and because of that there is a QR code on the screen where if you scan with your phone’s camera, you can send whichever crypto he’s talking about and get double or triple the amount of what was sent, back.
Sounds legitimate right? Afterall, it’s coming from the mouth of the President of the United States, so it has to be true. I do know of course that it is NOT true and if you scan the QR code and send any cryptocurrency, you will NEVER see that cryptocurrency again and you most certainly will not get double or triple the amount of whatever crypto was sent.
I have never fallen for this type of crypto scam, but I know of others who have and once it’s sent away, it goes to a private wallet and they are unable to retrieve any of that back. This type of scam was working so well that the CEO of Ripple, which is the company that developed the cryptocurrency known as XRP, had to make a video warning people that other videos where he apparently says that if you send a certain amount of XRP to the QR code, you’ll get a certain amount back, is definitely not him and he would never do anything like that and warns you will lose any XRP that you send out.
Now there are others similar to this that use Elon Musk, the President of the United States (as I mentioned above), even other celebrities that can be movie stars or even well known musicians. Run for the hills if you ever come across such things on YouTube, TikTok, or other places. They are fake and the scammers are just trying to take away your crypto. The next one I’m going to talk about is a nasty one and I’ve actually been a victim of this. It is by far the worst one I’ve ever dealt with.
Sim Swapping Scam
This one hits hard, especially for me since it acutally happened to me nearly four to five years ago. What this kind of scam does is involve the sim card on your phone. It points your cell phone to your carrier’s network by storing security keys and authenticating your identity on the network.
So how does the scam work? Scammers are able to use methods to clone your SIM and then they use a method of social engineering to switch a phone number to a different SIM which is likely on a different carrier. What you’ll then start to notice is that your phone will start to lose connectivity to your carrier and soon you’ll be unable to make calls or use the internet through its network. You might now be thinking “Well, I’ll just contact my phone carrier, tell them I didn’t authorize this and have my number back to where it should be”. That’s fine well and good, but here is where the REAL damage comes from.
Once your phone number is ported out to a different carrier and phone, the scammer’s phone in this case, they now have full access to any 2-Factor Authentication you may have setup which is usually your online banking and cryptocurrency exchange. So when they attempt to log in, they’ll now receive the second part of authentication, log into your account fully and then start to do damage.
Now I mentioned this happened to me some time ago and so I’ll talk about what happened. I noticed one day at my job about 5 years ago, my phone was starting to act strangely, it said I no longer had date service on my phone and soon full cellular service was no longer available. I thought that maybe they were updating wireless towers in my area, but service never came back. I had to use a friend’s phone after work that evening to contact my service provider to see what is going on. Now at the time, it was Sprint but they were in the process of merging with T-Mobile. This is apparently the time they had a lot of vulnerabilities.
When I finally got a hold of a representative, she told me that my number had been switched over to another carrier. I became livid and said WHO gave permission to do this because I did not and I want my phone number back NOW!!! The representative put me on hold and had to speak to a manager. After a few minutes she apologized that this happen and assured me that my phone number would be back and operating on my phone by midnight. I said that is fine and I thought that was the end of that saga. Boy was I definitely wrong.
Early the next morning when I was at my first job of the day, I wanted to check my checking account on my phone through my bank’s mobile app because I was expecting a stimulus check to hit my account any day now. This was back during the time of COVID. Let’s just say that when I opened my account and looked at what was in it, my jaw dropped. No I did not receive the stimulus yet, but instead what I saw is that my account was extremely negative as there were two large pending charges from a cryptocurrency exchange that I had an account with at the time.
I definitely did not authorize anything from this specific exchange (because of a class action lawsuit and settlement that came of this situation (others also experienced something similar), I’m not allowed to say which exchange it was). I immediately tried to log on to my account on the crypto exchange and found that I couldn’t log in as my password was changed without my consent.
It was then that I realized that in the hours where I had no phone access and my phone number was elsewhere, the scammer that initiated the whole sim swap scam managed to gain access to my account on this crypto exchange. I was able to get the unauthorized charges reveresed in time thanks to my bank, but the cryptocurrency I actually had in my account was completely gone which at the time was worth over $1,000.
I was angry how my cell phone company at the time allowed my phone number to be ported out without my authorization, but the crypto exchange’s response to this scam was FAR worse than the response of the cellular company which is why I joined a law firm’s class action lawsuit in order to get some kind of compensation from this.
Today, a lot of the cellphone companies have realized how bad sim-swapping is and have taken steps to minimize it including my cellphone company now. I always once in awhile check in with them to make sure their security up to par to prevent future instances of this type of thing and they’ve assured me of the measures in place to prevent that from happening and thankfully, I’ve had no such thing happen since. Now it’s time to take a look at another crypto scam that got me, but thankfully not as costly as the sim-swapping incident.
Rug Pull
This one may sound a bit strange, but bear with me as you’ll fully understand why this particular cryptocurrency scam got me….not once, but twice. Once upon a time, Bitcoin was the first and only cryptocurrency out there. Then came others and soon there were thousands. Then came hundreds of thousands and now there are supposedly millions of different kind of cryptocurrencies out there. I’ll be honest, most of them are complete junk, but because cryptocurrency remains largely unregulated, here is what happens with what is known as a “Rug Pull”.
Developers come along with a new idea for a cryptocurrency and so they begin creating (sometimes they don’t) a new cryptocurrency that will supposedly do this or do that and that it will be the hottest new cryptocurrency out there. They will create ads, write blogs to talk about their new upcoming token, and begin a presale where people can buy a certain amount of the tokens and then say that the new crypto could be worth a lot after it fully launches.
There is just one problem, it never fully launches or the presale has no true end date and the promise of a brand new crypto that could be worth a lot, is now broken as the “developers” took the money they got from the presale and ran, never to be seen again.
This happens a lot and will continue to happen until full regulation of the cryptocurrency arena happens. Now I have mentioned that I did fall for this kind of scam twice. The first time was the promise of a brand new crypto called VC Spectra. It was supposed to be a cryptocurrency tailored around investors with promises of rewards and other things for holders of this particular crypto. I liked the look of the website and the promises of what the crypto was going to offer so I paid $30 for a nice little chunk of this token. Well, let’s just say that when it was actually time for the crypto to launch or the presale to end, the website vanished along with its creators.
I did lose a little bit of money, but nowhere near the amount that others lost. Supposedly a couple of millions of dollars was raised for this presale and then it was all gone. I certainly wasn’t happy, but I can definitely live with $30 gone down the drain compared to what others have lost. To this day, no one knows what happened to the scammers who created the rug pull.
Around the same time as this, I found another ad for a new crypto that was created for those who missed out the original Bitcoin run ( a single Bitcoin today is worth over $75,000). This upcoming crypto was called Bitcoin Spark and had a total account of I believe around 21 million just like the original Bitcoin tokens. Just like VC Spectra, they made all these promises of what they coin was going to do and how the network it is on was going to be faster and better than Bitcoin. Now after the presale, I did receive the amount of Bitcoin Spark tokens I was promised…..and then the developers disappeared thereby making the tokens absolutely worthless. So now I have absolutely worthless crypto. Because of these two experiences, I have stayed far away from new crypto launches.
Always Do Your Research And Be Careful
What I talked about above are just some of the cryptocurrency scams out there. Now there are people out there who have made a lot of money from the legitimate crypto that’s there, but as I said before, because it’s unregulated, it is very easy to fall for crypto scams and nearly impossible to get your money back when something goes wrong.
That’s why it is extremely important to do your research before jumping into the cryptocurrency pool. It took me awhile and a lot of learning as well as some losses, but I truly did make some money from the cryptocurrency world as I have been in it since 2017.
Also, if you meet someone online who later says you can make a lot of money in a short amount of time by investng in cryptocurrency, run for the hills. They want you to sign up for their fake crypto investment platform where you put in lots of money and then the platform will show that you’ve made a lot of profits prettty quickly and so the person who got you to sign up for it will continue to press you to put in even more money for even bigger profits. The problem comes when you try to withdraw those profits. Your supposed account on that platform will suddenly freeze and the person who got you into this investment scheme, is gone and so is all the money you put into that investment scheme. Of course, this is known as Pig Butchering.
As a bank teller, I’ve been fortunate enough to not have most of my customers fall for any kind of cryptocurrency scams. Some have asked though if it is ok to get into cryptocurrency. I tell them the honest truth that you need to do your research first and if it’s something they want to move ahead with, it’s best to create a separate bank account used specifically for that purpose so that way, your primary accounts will not be affected if something goes wrong.
Check back soon as I’m going to talk about a scam that does involve institutions and is a growing threat to many institutional customers! You won’t want to miss this so definitely check back as it has even affected some of my customers.