Cryptocurrency fraud is the biggest financial threat to investors, according to a new report from the North American Securities Administrators Association (NASAA).
The most common cryptocurrency scams identified by the NASAA include fake digital wallets and multi-level marketing platforms.
Another scheme identified is a “pump-and-dump” system, which involves groups coordinating their efforts to promote a cryptocurrency to drive up the price, and then coordinating a sale to devalue the crypto for everyone else.
With a global market value of cryptocurrency now at $2 trillion, the market continues to grow alongside cryptocurrency fraudsters.
In his advice to investors, NASAA’s Enforcement Section Committee Vice-Chair Joseph Rotunda told them to be careful when navigating the “crypto craze.”
“Investments in cryptocurrency trading programs, interests in crypto mining pools, crypto depository accounts, and securitized tokens should be seen for what they are: extremely risky speculation with a high risk of loss,” Rotunda said.
In addition to investments related to cryptocurrencies and digital assets, other top threats have been identified, including promissory notes, money scams found on social media, and financial schemes related to Self-Directed Individual Retirement Accounts.
For more information, read the original story in ZDNet.