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FTC Reports Huge Jump in Cryptocurrency Scams
ecommercetimes.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from ecommercetimes.com Daily Mail and Mail on Sunday newspapers.
FTC Reports Huge Jump in Cryptocurrency Scams
ecommercetimes.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from ecommercetimes.com Daily Mail and Mail on Sunday newspapers.
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//]]>// >By John P. Mello Jr.
May 19, 2021 4:00 AM PT
Claims of losses from cryptocurrency scams skyrocketed from October 2020 to March 2021, according to a report released Monday by the Federal Trade Commission.
In its Consumer Protection Data Spotlight newsletter, the FTC revealed that during the October to March period nearly 7,000 consumers reported losing US$80 million. That compares to only 570 cryptocurrency scam reports amounting to $7.5 million in losses from October 2019 to March 2020.
The median loss reported was about $1,900, a nearly 1,000 percent increase over the same period a year ago.
The agency noted that as the value of cryptocurrencies like bitcoin continue to soar, new investors are eager to get in on the action, and scammers are more than willing to accommodate them.
How Financial Advisors Should Advise Clients on Bitcoin © (Getty Images) Financial advisor explaining concept to client
The rapid declines and rises of bitcoin prices draw more attention and queries about the value of the cryptocurrency, especially for financial advisors with clients who are unsure about allocating money to the digital currency.
Bitcoin remains the world s largest digital currency by market capitalization and reached an all-time high of $41,940 on Jan. 8. The extreme volatility of Bitcoin and lack of regulation has kept the majority of institutional investors, such as pension and hedge funds and retirement companies, at bay.
Between 2017 and 2018, billions of dollars of market cap were erased from hacking, regulatory orders and massive volatility. Bitcoin reached a high of nearly $20,000 in December 2017, but it plunged to about $8,500 in March 2018 and hit lows of around $6,000.