Crypto Scam: Coinbase Warns Gen Z Against Online Threats on the Rise
Coinbase is sounding the alarm to increase awareness of the rising online scams that have so far hit younger users, particularly Gen Z.
In its blog post dated Oct. 8, Coinbase listed four online threats to which Gen Z should be wary: fraud via social media, romance scams, fake websites, and recovery schemes.
The exchange underlined that, in stark contrast with the classic banking system, where security is partly dependent on the institution, users of cryptocurrencies bear full responsibility for asset safety. That is because cryptocurrency users take assets directly into possession and may, at the same time, turn out to be the best protection against theft or the greatest security risk.
Social Media Scams
Number one among the most targeted scams that Coinbase warned about was an impersonation scheme targeting social media sites such as Instagram and TikTok, particularly for creating or impersonating the profiles of famous people.
Many scammers introduce investment opportunities that sound very legitimate to unwary users; these are rarely, if ever, actual offers. Coinbase recommends customers be cautious around unsolicited messages from strangers touting crypto investments.
A recent example of such a scam was pulled off in Vietnam, where five suspects working for a crypto fraud network built fake romantic relationships with their victims via social media, then lured them into investing in the phony digital platform. Victims were relieved of more than 17.6 billion Vietnamese dong, about $700,000, through such scams.
Romance Scams and Bogus Sites
One of the new growing threats that Coinbase warns against is romance scams, more correctly called pig butchering scams.
Romance scams deal with fraudsters who befriend victims with the impression of finding a possible love match. These impostors make out personal relationships in which they come closer to gaining confidence from their victims and exploiting them for money. Most of the cases take place on some kind of dating apps or on social media platforms.
The fraudsters create fake websites to lure victims into giving personal information or money. Most of these websites are fake imitations of some legitimate companies, with minor differences in their URLs.
In another case, on Oct. 3, a US citizen sued after he lost $2.1 million in Bitcoin through a pig butchering scheme involving fake crypto exchange sites. Also, as Coinbase warned, scammers from Southeast Asia used those fake sites to fake trading and, eventually, withdrew all the money from the unsuspecting victim.
Increasing Awareness and Reporting for Scams
According to Coinbase, in 2023, more than 67,000 online scams were reported whose median loss reached $3,800.
It was underlined that awareness and reporting on suspicious activities might save other people from being further victims of such fraud. The company will encourage people to report scams to the law enforcement authorities and platforms like Coinbase to help in the fight against cybercrime.
The crypto ownership is coming with some responsibility, and what’s clear in the message of Coinbase to its Gen Z audience is: ‘Be vigilant, know the risks, and be a protector of the community from fraud’.
