2020-1-8 15:15 |
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Recent investigations into the ‘shadow side of cryptocurrencies’ have discovered that around €15 billion ($16.7B) in digital assets have been stolen since 2011.
Scams are without a doubt still rampant in the cryptocurrency industry. This year alone, we’ve seen cryptocurrency thefts and scams top $4.3B.
PLUS Token made major headlines this year for defrauding investors out of a record $3B in funds. For much of the latter half of 2019, the scam was dumping some 1,300+ BTC on the market daily. Although these scams and thefts were especially bad in 2019, they’ve been an ever-present problem for the industry for the majority of the past decade.
€15 Billion ($16.7B) and CountingScams have only gotten worse in the past few years, and many can be linked back to the cryptocurrency market’s humble beginnings. Indeed, even in 2011, there was a rampant problem. A recent report by De Correspondent found that, in total, €15 billion ($16.7B) in cryptocurrencies have been stolen since 2011.
The analysis presents a long list of scammed exchanges that have plagued the industry over the years. Some exchanges and entities were simply victims of hackers; others, however, outright taken its users.
De Correspondent looked into 70 of the worst fraud cases in the cryptocurrency industry — topping the list is OneCoin (€3.6B), PlusToken (€2.6B), Bitconnect (€2.25), and BTC-e (€1.3B). These four hacks are the only instances where the stolen funds amounted to more than €1 billion.
How Thieves Steal Your CryptocurrencyThere are a few avenues that hackers usually use to steal funds from victims. Most common is the outright exit scam which the author links to the recent fiasco involving QuadrigaCX. There’s also the ICO model, which experienced a boom in 2017 but saw many of these projects go ‘bankrupt’ in 2018. In reality, some simply ran off with the funds. Scammers also sometimes employ the classic ‘multilevel marketing’ approach which is essentially just a standard pyramid scheme dressed up with blockchain lingo.
Of course, there are countless more ways that scammers employ to steal money. These range from extortion, theft of SIM cards, exploiting sloppy exchanges, and even state-sponsored thefts (as in the case of North Korea).
That being said, scammers in the cryptocurrency industry are not using novel techniques nor are they reinventing the wheel. These are classic schemes that have plagued the market at large for a long time. The problem is that the cryptocurrency industry is still far too young to properly fight against them, and the necessary consequences for scammers are still poorly established.
Perhaps 2020 will finally see the tide changing towards greater security and trust, otherwise, the cryptocurrency world will have a hard time legitimizing itself in the years to come.
The post Cryptocurrency Theft Totals Quickly Approaching $20B Over the Past Decade appeared first on BeInCrypto.
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