The United States Federal Trade Commission has labeled social media and crypto a “combustible combination for fraud,” with nearly half of all crypto-related scams originating from social media platforms in 2021.
Published on Friday, the report found that as much as $1 billion in crypto has been lost to scammers throughout the year, which was more than a five-fold increase from 2020, and nearly sixty times up from 2018.
As of March 31, the amount of crypto lost was already approaching half of the 2021 figure, showing that momentum doesn’t appear to be slowing.
The FTC found that Instagram (32%), Facebook (26%), WhatsApp (9%) and Telegram (7%) were the top platforms used for crypto scams.
Interestingly, Twitter, the social media platform widely adopted by the crypto-community, was not mentioned despite being littered with spam and scam bots touting fake crypto giveaways.
Based on fraud reports to FTC’s Consumer Sentinel Network, the most common type of crypto scam was Investment Related Fraud, making up $575 million of the total $1-billion figure.
“These scams often falsely promise potential investors that they can earn huge returns by investing in their cryptocurrency schemes, but people report losing all the money they ‘invest.’”
According to the FTC, common investment scams include cases in which a so-called “investment manager” contacts a consumer, promising to grow their money — but only if the consumer buys cryptocurrency and transfers it into their online account.
Other methods include impersonating a celebrity who can multiply any cryptocurrency that a consumer sends them or promises free cash or cryptocurrency.
The FTC also lists scams that involve investment in fake art, gems and rare coins, bogus investment seminars and advice, and other miscellaneous investment scams as part of this group.
Since January, Bitcoin ATM installations saw a gradual slowdown, eventually falling down 89.75% from December 2021’s 1,971 new installations. However, data from Coin ATM Radar reveals an evident comeback in the installation numbers, as the world saw 817 Bitcoin ATMs installed in June — in just the first five days.
Some of the key factors contributing to the slowdown of crypto ATM installations include geopolitical tensions across the world, unclear or anti-crypto regulations, market saturation and business impact due to the ongoing coronavirus pandemic.
Coin ATM Radar’s data confirms that the United States is home to 87.9% of the total 37,826 crypto ATMs worldwide. Europe houses a network of 1,419 ATMs, representing 3.8% of the global ATM installations.
Crypto ATM manufacturer Genesis Coin maintains its position as the leader in terms of the market share, representing 41% of the total operational crypto ATMs across the globe. Other manufacturers with prominent market share include General Bytes (21.6%), Bitaccess (16%), Coinsource (5.4%) and Bitstop (4.7%).
While real-world challenges may have a momentary impact on Bitcoin’s physical expansion via ATMs, at its core, the Bitcoin network continues to outperform its previous records in securing, decentralizing and speeding up the impenetrable peer-to-peer network.
As Cointelegraph reported based on data from Bitcoin Visuals, the Bitcoin Lightning Network (LN) capacity attained an all-time high of 3,915.776 BTC — further improving BTC transaction speeds and reducing fees over the layer-2 protocol. The Bitcoin LN was first implemented into the Bitcoin mainnet in 2018 to address Bitcoin’s infamous scalability issues.
As the state of New York pushes forward a bill that will ban proof-of-work (PoW) mining once approved, members of the crypto community express their disagreement through social media.
In a Twitter thread, Jake Chervinsky, the head of policy at Blockchain Association, explained that the move will not “reduce carbon emissions” at all. According to Chervinsky, a mining ban will only push miners away from New York to build in other areas where the state has no influence over them.
Chervinsky hopes that New York Governor Kathy Hochul will veto the bill “for the sake of New York." The lawyer noted that the move sends a message that "crypto is not welcome" in the state. If the bill is implemented, Chervinsky mentioned that it will be a policy error from the world's financial capital.
Apart from Chervinsky, United States senatorial candidate Bruce Fenton also opposed the move. In a tweet, he said that governments do not have the right to determine the specific software people run. He noted that “code is speech,” implying that the ban is a move against freedom of speech.
Ethereum founder Vitalik Buterin also agreed with Fenton. Sharing his thoughts on the issue, Buterin said that the government should not choose which applications are "okay" uses of electricity. He suggested the implementation of carbon pricing and using the earnings to compensate users with low income.
On June 3, the bill to ban PoW mining was approved by the New York State Senate. If approved by the governor, the bill will ban mining in the state and would hinder the renewal of previously-approved mining permits.
Amid the push to ban mining, New York Attorney General Letitia James warned New Yorkers against investing in crypto. In an investor alert, James stated that many are "losing billions" in cryptocurrencies and that even prominent projects could crash.
This Daily Dose was brought to you by Cointelegraph.