Since Bitcoin, there have been so many digital currencies that have developed with the aim of taking a share of the pie. As a result, the euphoria that has ensued is overwhelming. The performance of Bitcoin and the tokens that were developed in its immediate wake performed so well that the cryptocurrency market became a contemporary gold rush. Trading cryptocurrencies has come to be so lucrative for some that it has attracted throngs of buyers and sellers who are out to cash in on the phenomenon. Markets for trading of the tokens have sprouted all across the globe and are growing larger.
The promise of large sums of money in profits is too tempting for scammers to let pass by. In any environment where there is a lot of money in whatever form changing hands, there is a group of individuals with ill motives that want to net a fortune without actually breaking a sweat. At this moment, this is what is happening in the crypto market. These individuals have taken advantage of the many tokens in existence that have been created to competitively participate in the market to steal from other people’s digital wallets. Recently, the media has been awash with reports of fake accounts created on Twitter that target unsuspecting individuals with digital token give-ways that are too good to be true, for example.
Lack of information
So far, some scammers have been successful in their quest to rip money off other people and it may go on for a while. This is mostly due to the information asymmetry phenomenon that is prevalent. Blockchain technology has been in existence for a short time only and therefore the public is not completely ware of its intricacies. Also, the technology involves a lot of technical knowledge that may be hard for an average person to understand.
Criminals exploit these vulnerabilities as they target to defraud average people. They feed on their lack of information and sometimes deliberately misinform them, with the aim of taking their tokens. The scammers mostly utilize online advertisement platforms to market themselves and offer discounts that leave their victims holding the bag.