7 Major Crypto Scams Events and What We Can Learn From Them

Crypto scams have been around ever since Bitcoin came out in 2009. Crypto researchers found out that from 2011 to 2020, cyber criminals stole almost $2.5 billion  online. Roughly 80% of these funds, the equivalent to $2 billion, was from digital currencies.

The growth rate of cryptocurrencies has increased over time, with most coins, such as Bitcoin, hitting an all-time high of $63,000. While intelligent minds have come up with coins and companies backed by blockchain, scammers have also upped their game to target unsuspecting investors.

Major Crypto Scams of All-Time

As much as cryptocurrencies have revolutionized transactions, they have also been a target for significant scams. Let’s look into the major crypto hacks and what we can learn from them!

OneCoin – $15 billion

In front of thousands of fans, Dr. Ruja Ignatova announced back in 2016 that she would launch a new cryptocurrency, OneCoin. She mentioned that it would work just as any crypto. For instance, it would reach global payments, involve mining, etc. The coin would have had a $120 billion supply on the network.

Even though all the information was very similar to Bitcoin, people still fell for it. More so, they thought that Ruja was perfect. She could speak several languages fluently and had a Ph.D. from Oxford University. Above all, she appeared in top magazines as a crypto expert.

As part of this crypto scam, people had to select education packages that cost between €110 and €188,000. In each package, several tokens would correlate to mining OneCoins. However, the only way to sell the tokens was through the internal exchange. Also, only users that purchased more than the starter package could buy these tokens.

As you probably have guessed, the exchange did not even exist. More so, people were trading with the company itself, which is a clear red flag. The members also only profited from inviting new users.

When the police found out, Ruja had already disappeared. Next, a two-year investigation led to several arrests. Among them were Ruja, her brother, and the lawyer behind the company.

Bitconnect – $3.45 billion

One of the most infamous crypto scams, Bitconnect appeared in 2017. It claimed that users could exchange Bitcoin for the Bitconnect Coin(BCC) on their Bitconnect platform. The developers also made sure that significant returns of 40% would trickle into their accounts over time.

Bitconnect also ran a lending program that allowed users to lend out BCC to other users on the platform. By doing this, they would get interest from the amount they lent out. It should have been a red flag for a typical Ponzi referral scheme.

Shortly after, the platform turned out to be a scam, and their investors lost most of their funds. Some of them have since filed a lawsuit against Bitconnect in a bid to recover their lost assets.

Pincoin- $870 million

In Vietnam, Modern Tech launched Pincoin and iFan, with its offices in Ho Cho Minh City. Pincoin captured 32,000 people who, instead of receiving cash as payment, got a new token called iFan. Top celebrities advertised iFan on social media. Therefore, the project did not look suspicious at all.

A few months down the line, their offices shut down. The project creators managed to get away with about $870 million. Protestors met outside their vacant offices on April 8, 2018, but they did not process cash withdrawals.

Centratech – $32 million

Centratech appeared on the market with a heavy expectation. Many thought that it would bring a Visa and Mastercard debit card service to help users convert cryptocurrencies to fiat. Also, to add to the spotlight it was already gaining, the likes of Dj Khaled and top boxer Floyd Mayweather advertised it. Just like that, the coin gained fame, and only its ICO raised $32 million.

The founders, Sohrab Sharma and Robert Farkas, did not manage to get away. Police arrested them on fraud charges. They had created fictional executives with great biographies, paid celebrities to promote it, and posted misleading marketing materials on their website.

The U.S. regulator enforced that they both pay back what they stole and at interest. Also, the regulator banned them from ever serving as company officials and participating in any security offerings of sorts.

Plexcoin- $20 million

Plexcoin was one of those deals that seem too good to be true. The company offered a 1354% return for investments per month. Surely this should have been suspicious enough to investors, but the founders took about $20 million of their money. The coin’s ICO was successful and raised over $15 million alone.

However, the U.S. Securities and Exchange Commission(SEC) caught on to this after investigating and ordered that all the money they took needed to be repaid. SEC froze their funds, and the founder, Dominic Lacroix, was arrested and later jailed.

The event marked the first that the SEC stepped in and charged an ICO through its Cyber Crime Unit.

What to Learn from the Crypto Scams

Crypto-related scammers will go to any extent to convince people that their offer is legit. Considering this, investors need to wise up and do their research properly before investing in any cryptocurrency.

Generally, it necessitates that the crypto community provides financial education and ethical investments practices to everyone. Governments also need to be vigilant and regulate cryptocurrencies to remove the bad actors from the market.


Scams have an effect on cryptocurrencies in general. Most people have become skeptical about investing in cryptocurrencies because they either have heard about crypto scams or gone through one themselves. They then tend to classify all cryptos under these scams, whereas genuine ICOs and cryptocurrencies exist.

Bitcoin live price
price change

In turn, this is limiting growth and innovation in the crypto space.
The most effective way that investors will be protected is only by education. They need to know more about evaluating investments, spot scams, and learn how to manage risks. Authorities also need to realize that not all cryptocurrencies are scams, and some are here to stay. By taking their time in understanding cryptocurrencies, and the blockchain in general, they can offer knowledgeable regulation that will promote innovation.

Stay up to date with our latest articles

More posts

Can You Really Protect Your Crypto Investments Against Whales?

It is only natural that the price of BTC changes following whales' transactions. Because altcoins have smaller market capitalizations, this effect is even more pronounced on their prices. The ways whales manage to manipulate the market are inventive and can lead to heavy losses for small traders. In our guide, we look into the matter and reflect on how to protect a wallet against whales. Understanding the Concept of Whales The term "crypto whale" refers to a person or organization…

Diluted Market Cap – A Beginners’ Guide

The value of a cryptocurrency is difficult to predict, especially if we are dealing with a new token. If you're looking to invest in cryptocurrency, measures like the fully diluted market cap can guide your choices.  The term "fully diluted market cap” will represent the core of today’s guide. We'll begin by defining the sector's market capitalization before moving on to more advanced notions. Market Cap in the Crypto Industry The total worth of an asset now in circulation corresponds…

The Difference Between Capped and Uncapped ICOs

Some ICOs decide to set a cap on how many coins investors can buy. However, some people choose to offer unlimited coins at the sale. Different teams can follow different strategies to obtain success in this growing market. Today, our guide aims to make a clear distinction between capped and uncapped ICOs. Understanding the Concept of ICOs An ICO (“Initial Coin Offering”) is a way to launch a new cryptocurrency. ICOs are a way to raise money for a project…

3 Meme Coins Still Riding the Meme Wave and Ready to Explode

With Elon Musk on the verge of buying Twitter, his pet crypto, Dogecoin, could rise to new heights of popularity and demand. However, DOGE is not the only meme coin ready to burst on the scene in 2022. Others are waiting for a signal to show the meme wave is not only alive and well but rising too. Meme coins started out as a joke. In a market dominated by raging bulls and bears shifting crypto prices by the thousands…

What Is a Nonce in Cryptocurrencies?

As the world learns more and more about cryptocurrencies, many non-technical investors frequently discover new notions. Today, we will spend some time on the concept of “nonce,” a famous idea among IT experts. Our article simplifies the notion for non-technical readers, focusing on the importance of the nonce mechanism in cryptocurrencies. A Concept Born Before Cryptocurrencies A nonce is a random or semi-random number that cryptographers have known and used for decades. The term “nonce” stands for "number used once,"…

Learning the Difference Between Soft Cap and Hard Cap in Crypto

Before evaluating an ICO for a crypto project, all traders must consider many aspects. Today we will talk about two of the most noteworthy: hard and soft market capitalization. A hard cap is the maximum amount of money a company hopes to raise in an ICO. On the other hand, a soft cap is the least amount of funds creators need to launch their project. Our analysis will go beyond the mere definition and provide food for thought on the…

A Guide to Ethereum Virtual Machine

The Ethereum Virtual Machine (EVM) is a processing engine that functions as a decentralized computer. The EVM matters because it includes millions of executable applications based on the Ethereum system. It serves as the virtual computer that the Ethereum Foundation has put at the core of its ecosystem. The EVM is the portion of the network responsible for executing and deploying smart contracts. The Strategic Role of EVM The EVM's job is to integrate various additional features into the Blockchain…

What is Ethereum Whisper? A Guide for Beginners

The distributed ledger system supporting blockchain technology has recently caught Wall Street's interest. The potential for disruption in the financial industry and beyond is becoming more evident every day. Blockchain has high potential, from cross-border payments to settlements and clearing over-the-counter derivatives. As many know, one of the leading players in this industry is Ethereum. The goal of Ethereum is to establish a new protocol for building decentralized apps (or Dapps). These apps offer various features that are extremely useful…

The Best Metaverse Projects to Keep an Eye on in 2022

Metaverse is now becoming the talk of the town. Ever since Mark Zuckerberg's revelation about Facebook and other platform moving towards the metaverse, people are eyeing the fantastic opportunities that come with it. The new projects based on virtual reality and other technologies allow different experiences. As Facebook is embracing the metaverse, it will be launching new projects that combine the concepts of VR, cryptocurrencies, and other things. With 2021 being the year of NFTs and Defi, we will see…

Is Cryptocurrency Anonymous?

How blockchains and cryptocurrencies handle investor data is a topic of great interest in the market. The data-encryption layer of a blockchain is one of the mechanisms that attract traders the most. However, there is an essential difference between encrypting users' data and providing transaction anonymity. How can a system guaranteeing perfect traceability of transactions achieve excellent privacy protection? This article introduces and explores the topic of crypto anonymity with some practical, real-life examples. The original Bitcoin idea Before better…