Bitcoin surge prompts crime concerns

There are new warnings for the owners of cryptocurrency amid, as bitcoin soared to a record high, topping £54,000 on this week.

The call for vigilance came as new analysis of fraud data conducted by Smart Betting Guide, which found users lost more than £1.3 billion (£1,385,090,516) due to exploits and exit scams last year – with bitcoin the second-most affected currency.

Over the last year, bitcoin users saw £209,190,929 stolen by scammers, equivalent to 15% of the total sum lost. The most common tactic scammers used was an access control exploit, used to take two-fifths of bitcoin’s total stolen funds (46%).

This exploit sees scammers exploit a vulnerability to gain access to user credentials or data through compromised private keys, networks, or security systems.

The company said with the cryptocurrency leaping in value to a point where it exceeded £54,470 at one point, many users may be considering increasing their investment to capitalise on the rise, while first-time investors may also be tempted.
The spike came after the Securities and Exchange Commission allowed 11 firms to start exchange-traded funds (ETF) based on bitcoin, which can be traded like stocks.

ETFs allow investors to get into cryptocurrency through their brokerage accounts without needing to buy and store the digital tokens themselves. Yet, these are still vulnerable, as it is difficult to safeguard investors from market manipulation.
Market manipulation refers to the deliberate use of deception to artificially increase or decrease the value of cryptocurrencies, which can be done via exploits like flash loan attacks – which saw £77.2 million stolen from all crypto users last year.

Speaking on the findings, Zigmas Pekarskas, CEO of Smart Betting Guide, said: “As cryptocurrency continues to grow in popularity among investors or experiences a surge in value like bitcoin did this week, so does the appeal to scammers – especially among volatile blockchains or inexperienced users.

“First-time investors are particularly vulnerable right now as they may have rushed to invest in bitcoin amid the soaring price without considering the security implications. It is essential that both long-term and new investors prioritise securing their funds sooner rather than later to avoid the surge in scams that are likely to follow.

“Do not share your personal information with anyone unless you are 100% sure the request is safe – especially if you have been randomly contacted over text or email. If you know a cryptocurrency is particularly volatile or is experiencing a surge in interest, exercise caution before accepting investment support.

“Ensure that you are aware of how cryptocurrencies and blockchains work so that you can identify any discrepancies that may allude to ulterior motives. Make sure you only trade via reputable exchanges and always use a secure eWallet to hold funds.”