How to Spot a Crypto Scammer

Scammers are everywhere and they especially love crypto due to its digital nature and anonymity. At CoinField, we want our customers to know that we care about security, and we definitely don’t want you to be a victim of a scam. In this post, we will highlight some of the scams that people try to play on our customers, and how to spot a ponzi scheme.

Giveaway Scams

One example we see quite often at CoinField is the scammer who leaves comments on our social media posts encouraging our customers to enter giveaways. Not only is the spelling and grammar a dead giveaway, but we will not ask you to send us crypto. Ever. 

Here, the scammer wants the customer to deposit BTC into their wallet in return for more, up to 2.4 BTC! It sounds like a great deal, you give a little and get even more back, but this is a scam and this person will never send you the BTC. Please ignore these comments. We do our best to delete and report these accounts, but they continue to pop up. We ask you to be vigilant and cautious before interacting with these scammers. 

Bogus Support Emails

Here, a scammer targeted a CoinField customer with a bogus customer support email address. The customer, who had a technical difficulty with their CoinField account, was encouraged to email a fake support email address by a scammer. Then, the scammer tried to get them to follow a procedure to be able to sign in again. This procedure would inevitably lead to their account details being stolen, had we not intervened and advised the customer that the email they received was not from CoinField Support.

The overuse of exclamation points is one way to know this is a scam. At CoinField, we value customer satisfaction, and this many exclamation points in a message to a customer who is having technical difficulties, conveys a lack of seriousness.

We take all support queries seriously and we would not treat a customer’s issue with such flippancy. Our support email address is support247@coinfield.com and if you are encouraged to write to, or receive an email from any other “support” address, please be aware that it is not us. 

Ponzi Schemes

Ponzi schemes are an unfortunate and classic example of how scammers take advantage of people who are looking to make money, but may not have enough knowledge about crypto to spot them. One notable example of how people’s crypto investments disappeared happened when PlusToken, an alleged ponzi scheme set up in China in 2018, promised a high return on investments to its members if they invested in its token PLUS. 

Crypto scammers

The scammers conned roughly 3 million people out of $3 billion dollars when members reported they couldn’t withdraw their funds. Approximately 200,000 Bitcoin, 789,000 Ether and 26 million EOS were in wallets that the PlusToken team controlled. It is speculated that the PlusToken team has begun liquidating the crypto assets on global exchanges, and while some of the founders were arrested, others associated with the scheme remain at large and continue to liquidate. 

How did PlusToken Manage to Dupe So Many People? 

The scheme was mainly advertised through WeChat, mainland China’s most popular messaging app. It’s theorized by Primitive Venture Co-Founder Dovey Wan that most of the investors were average citizens who knew little about bitcoin and the organizers of the scheme even helped educate investors on how they could buy bitcoin in order to contribute to the scam.

“China has enjoyed an explosion of wealth creation in recent decades, so Chinese citizens used to quick capital growth and wealth accumulation are less sensitive to this type of Ponzi when they front as high-yield investments.” 

Dovey Wan

Read more about PlusToken on Bitcoin Magazine.

Education and Awareness 

Educating people on what to look out for and how to spot a scheme like this can prevent people from unwittingly handing over their money. 

Here are some common characteristics of ponzi schemes in crypto:

  • Promise of high returns with little or no risk
  • Consistent returns despite the volatile nature of crypto markets
  • Unlicenced and unregulated sellers who do not have proper authority to operate
  • Difficulty receiving payments you were promised
  • Difficulty in getting any official paperwork or information without first joining the scheme
crypto scammers

Reporting Fraudsters

If something sounds too good to be true, it probably is. If you feel suspicious of a crypto exchange or a token, then listen to your gut and walk away. This site called Bad Bitcoin, lists crypto exchanges and coins that they believe are frauds and you can submit suspected fraudsters for them to investigate.  It’s a great example of the crypto community working together to shut down scammers and build trust in the blockchain.

We want you to feel safe when trading with CoinField, so if you ever have any concerns, we are here to help. Our support email is support247@coinfield.com. We look forward to putting your mind at ease!