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Cryptocurrency buzz drives record investment scam losses

kaliali 5y ago
Quit falling for stupid scams people. You have the internet, do your own research. Watch a few YouTube videos, read a few articles, don't fall for a remade Nigerian prince scams. Read and learn about what you want to invest in before you actually do it. If you lose your money buying shitcoins, don't cry to the government to give you a bandaid. Get your shit together.
errantmind 5y ago
I posted this in a related thread, but it is relevant here as well. Anyone who has spent significant time in certain corners of the internet has seen the high prevalence of get-rich-quick desperation in (some) cryptocurrencies. It repeats each cycle, but was at high intensity this year due to the low barrier to entry with BSC smart contracts. Anyone could create a PnD shitcoin. All these scammers do is set up a nice looking website, fake some 'partnerships', then get influencers and spammers to put the word out. Once the scammers determine the market is at peak liquidity, they 'rug pull' by selling through all the liquidity, driving the price into the ground. Some rug pulls are instant, others are slow, to milk the buyers. These scams are very common.. there are thousands of them. A lot of people willingly participate because it is possible to make some profit off suckers before the developers pull the rug. The profits are drying up as suckers are running out of money or are finally getting wise to the formula. Despite how it sounds, I'm not in favor of regulation. I'm all for people learning lessons the hard way. I did at various times in my life and am better for it
- xwolfi 5y ago
  I'm waiting for the dragon satoshi to wake up on day and transfer one USD out :D That d be the rug pull to rule them all.
- bombcar 5y ago
  If you're bored and want to see receipts for a decent number of them, check out https://old.reddit.com/r/Buttcoin/ https://old.reddit.com/r/Buttcoin/ Current favorite whipping targets are Safemoon and Doge.
  - xrstf 5y ago
    Don't forget Internet Computer Protocol (ICP), which tries to replace the Internet but is also based on it.
    - errantmind 5y ago
      The price of ICP immediately following the listing on Coinbase should have been the signal to exit the current market cycle for anyone paying attention.
    - CashBowie 5y ago
      Agree the crypto industry has been riddled with bad actors and copy/paste code masquerading as "new" technology. Difficult watching retail investors get burned over the past decade. That said, the Internet Computer blockchain (ICP) is completely novel cryptography and advanced computer science. Raoul Pal, one of the most influential people in crypto, recently said, "The Internet Computer project is clearly the biggest in ambition of any project in the crypto space because it’s basically saying, ‘Here’s an entirely new architecture for the internet that is driven by cryptography and is scalable beyond anything that exists currently today.’ It’s faster than all the other blockchains." If you want supporting evidence, check out DSCVR, the world’s first fully blockchain-based social media platform. Note: This is being built by a prominent engineer at a notable Big Tech company during nights and weekends... and the Internet Computer only launched 7 weeks ago. http://dscvr.one http://dscvr.one Important to note, I work at the DFINITY Foundation, alongside ~200 of the world's most accomplished cryptographers, distributed systems engineers, and programming language and operation experts. Encourage pioneering entrepreneurs and developers to apply for a grant and start building. https://medium.com/dfinity/how-to-write-the-perfect-developer-grant-application-8d1c53e6477c https://medium.com/dfinity/how-to-write-the-perfect-develope...
  - 5y ago
- etaioinshrdlu 5y ago
  Also, sometimes the different between a scam and a bad product is hard to tell - the founders may not even know. I do know that being a big or famous name in tech made it very easy to capitalize on that name value by selling coins with your backing. Some of you are on this site reading this right now! It ends up not mattering if the project is a complete dud. You become a multi-millionarie anyways. And it was all legal. But not a lot of value was produced.
  - davidgerard 5y ago
    Crypto: never assume competent malice when you can assume incompetent malice.
  - errantmind 5y ago
    Yes, much of the valuations are purely speculative and, as a result, some people end up gaining wealth that doesn't appear 'earned', but this is true of any very early investor. There will always be people who say "there was no way you could have known this would become as big as it did" Cryptocurrency is teaching a lot of people about finance, who wouldn't otherwise know nor be allowed to participate. I believe that is overall a net positive, even if some people lose money in the process.
- puranjay 5y ago
  I once tracked newly listed pancakeswap pairs. Literally 98% of then rugged within 2-3 hours of launch.
- deleted 5y ago
  [deleted]
- tveita 5y ago
  > Despite how it sounds, I'm not in favor of regulation. I'm all for people learning lessons the hard way. If your neighbors pile their trash up on their lawn they might learn a lesson about rats the hard way, but the rats aren't going to stay put on their property. While people are "learning their lesson" the number of scams are growing, the scams grow more sophisticated, the money the scammers earn gets funneled into other kinds of crime. I feel like there's a common but naive sentiment that you can take a "social Darwinism" approach to petty crime without the small fry growing until their activities start impacting you and your loved ones. Scamming is an ecosystem like any other and it will grow healthier and more robust if you let it flourish.
  - errantmind 5y ago
    Unfair comparison. In your example the neighbor is forcing rats onto my property through their poor decisions. That is not the case with them making risky financial investments, and these scams are not some slippery slope that infect all of society. People are generally resilient against most scams after they encounter them once or twice. You could use your argument to justify government regulation for almost any decision that has consequences. This isn't 'social Darwinism', nor is it 'tough love'. It is about being able to make your own financial decisions without coercion and without obstruction If people choose to enter into poor 'investments' in a hope to get-rich-quick, that is their decision and they can live with the consequences
    - Aditya_Garg 5y ago
      Letting crypto scams flourish hurts the ability for crypto to be taken seriously by a lot of people.
Animats 5y ago
Proof of work systems are in trouble. China's government has had it with the power drain. Last Saturday, most of the major Bitcoin mining operations in China had their power cut off. Hash rate is way down. China's Bitcoin miners are frantically trying to find cheap gigawatts elsewhere in the world.
- tmarice 5y ago
  > Proof of work systems are in trouble. Bitcoin isn’t. Difficulty will adapt and all operations will carry on as usual.
  - Animats 5y ago
    The "investing in Bitcoin mining to get money out of China" industry just broke down. That was the high-volume use case.
    - lecarore 5y ago
      Makes sense given the cap they have on how much foreign currency they can buy
      - Animats 5y ago
        Right. China severely restricts sending money out of the country, while encouraging manufacturing and exports. If you're in China and want dollars or euros, make something in China, sell it outside China for a convertible currency, and keep the profits outside China. Bitcoin mining fit that model. It was making something in China and selling it outside China. Not only legal, but encouraged. That just ended.
puranjay 5y ago
I’ve been an ardent defender of crypto as my comment history would indicate. But man the past few months, the doge coin mania has birthed an astonishing amount of scams, rugpulls and zero-utility coins. I really can’t defend crypto at this point at all.
- betwixthewires 5y ago
  Why not? Every bull market has brought the scams. This isn't just in crypto. How many penny stock scams were perpetrated during the dot com bubble by adding ".com" to the name of a company? Scams are nothing new, scams in cryptocurrency are nothing new, and in all honesty 90% of them are obvious. General rule of thumb, if someone is telling you you can make money by spending some of your money right now, it is probably a scam, if they're saying you can make money by giving them some of your money then it is almost 100% certain to be a scam.
- herbst 5y ago
  That's self regulation at its best. We had those scams from beginning, the difference this year was the mainstream joining. When tor was full of bitcoin doubler websites I tracked multiple hundred thousand dollars getting burned daily for months until it cooled down. This is like 6 years ago. I guess many back then learned their lesson, so do many others today. Or remember Mt gox? When like half of the active bitcoin market was suddenly lost?
  - xrstf 5y ago
    > We had those scams from beginning I tend to disagree a bit. In the early days, most scams at least pretended to have some non-pump-and-dump usecase. Like Dentacoin or Filecoin. You could at least pretend to "buy filecoin today so you can store PB's worth of data in a year" or "buying Dentacoin now because in a year you need some dental work done". Nowadays all new tokens/coins have 0 usecases attached and only exist to be pancake swapped and pumped and separating other people from their money. It's all about lending, yielding, farming, interest rates, staking, ...
    - 5y ago
kemonocode 5y ago
The only reason this is news-worthy is because it's tied to the current hot button issue (cryptocurrency). Scams like these happen all the time during bull markets and the crypto investment maxims (never invest what you're not willing to lose, do your own research and if it sounds too good to be real, it usually is the case) apply just as well in any other kinds of speculative investments. Increasing regulation and adopting that sort of paternalistic attitudes will do nothing except harbor further dissent and widen the divide between the rich and poor, as it always has.

Quit falling for stupid scams people. You have the internet, do your own research. Watch a few YouTube videos, read a few articles, don't fall for a remade Nigerian prince scams. Read and learn about what you want to invest in before you actually do it. If you lose your money buying shitcoins, don't cry to the government to give you a bandaid. Get your shit together.

errantmind 5y ago

I posted this in a related thread, but it is relevant here as well. Anyone who has spent significant time in certain corners of the internet has seen the high prevalence of get-rich-quick desperation in (some) cryptocurrencies. It repeats each cycle, but was at high intensity this year due to the low barrier to entry with BSC smart contracts. Anyone could create a PnD shitcoin. All these scammers do is set up a nice looking website, fake some 'partnerships', then get influencers and spammers to put the word out. Once the scammers determine the market is at peak liquidity, they 'rug pull' by selling through all the liquidity, driving the price into the ground. Some rug pulls are instant, others are slow, to milk the buyers. These scams are very common.. there are thousands of them. A lot of people willingly participate because it is possible to make some profit off suckers before the developers pull the rug. The profits are drying up as suckers are running out of money or are finally getting wise to the formula. Despite how it sounds, I'm not in favor of regulation. I'm all for people learning lessons the hard way. I did at various times in my life and am better for it

xwolfi 5y ago
I'm waiting for the dragon satoshi to wake up on day and transfer one USD out :D That d be the rug pull to rule them all.
bombcar 5y ago
If you're bored and want to see receipts for a decent number of them, check out https://old.reddit.com/r/Buttcoin/ https://old.reddit.com/r/Buttcoin/ Current favorite whipping targets are Safemoon and Doge.
- xrstf 5y ago
  Don't forget Internet Computer Protocol (ICP), which tries to replace the Internet but is also based on it.
  - errantmind 5y ago
    The price of ICP immediately following the listing on Coinbase should have been the signal to exit the current market cycle for anyone paying attention.
  - CashBowie 5y ago
    Agree the crypto industry has been riddled with bad actors and copy/paste code masquerading as "new" technology. Difficult watching retail investors get burned over the past decade. That said, the Internet Computer blockchain (ICP) is completely novel cryptography and advanced computer science. Raoul Pal, one of the most influential people in crypto, recently said, "The Internet Computer project is clearly the biggest in ambition of any project in the crypto space because it’s basically saying, ‘Here’s an entirely new architecture for the internet that is driven by cryptography and is scalable beyond anything that exists currently today.’ It’s faster than all the other blockchains." If you want supporting evidence, check out DSCVR, the world’s first fully blockchain-based social media platform. Note: This is being built by a prominent engineer at a notable Big Tech company during nights and weekends... and the Internet Computer only launched 7 weeks ago. http://dscvr.one http://dscvr.one Important to note, I work at the DFINITY Foundation, alongside ~200 of the world's most accomplished cryptographers, distributed systems engineers, and programming language and operation experts. Encourage pioneering entrepreneurs and developers to apply for a grant and start building. https://medium.com/dfinity/how-to-write-the-perfect-developer-grant-application-8d1c53e6477c https://medium.com/dfinity/how-to-write-the-perfect-develope...
- 5y ago
etaioinshrdlu 5y ago
Also, sometimes the different between a scam and a bad product is hard to tell - the founders may not even know. I do know that being a big or famous name in tech made it very easy to capitalize on that name value by selling coins with your backing. Some of you are on this site reading this right now! It ends up not mattering if the project is a complete dud. You become a multi-millionarie anyways. And it was all legal. But not a lot of value was produced.
- davidgerard 5y ago
  Crypto: never assume competent malice when you can assume incompetent malice.
- errantmind 5y ago
  Yes, much of the valuations are purely speculative and, as a result, some people end up gaining wealth that doesn't appear 'earned', but this is true of any very early investor. There will always be people who say "there was no way you could have known this would become as big as it did" Cryptocurrency is teaching a lot of people about finance, who wouldn't otherwise know nor be allowed to participate. I believe that is overall a net positive, even if some people lose money in the process.
puranjay 5y ago
I once tracked newly listed pancakeswap pairs. Literally 98% of then rugged within 2-3 hours of launch.
deleted 5y ago
[deleted]
tveita 5y ago
> Despite how it sounds, I'm not in favor of regulation. I'm all for people learning lessons the hard way. If your neighbors pile their trash up on their lawn they might learn a lesson about rats the hard way, but the rats aren't going to stay put on their property. While people are "learning their lesson" the number of scams are growing, the scams grow more sophisticated, the money the scammers earn gets funneled into other kinds of crime. I feel like there's a common but naive sentiment that you can take a "social Darwinism" approach to petty crime without the small fry growing until their activities start impacting you and your loved ones. Scamming is an ecosystem like any other and it will grow healthier and more robust if you let it flourish.
- errantmind 5y ago
  Unfair comparison. In your example the neighbor is forcing rats onto my property through their poor decisions. That is not the case with them making risky financial investments, and these scams are not some slippery slope that infect all of society. People are generally resilient against most scams after they encounter them once or twice. You could use your argument to justify government regulation for almost any decision that has consequences. This isn't 'social Darwinism', nor is it 'tough love'. It is about being able to make your own financial decisions without coercion and without obstruction If people choose to enter into poor 'investments' in a hope to get-rich-quick, that is their decision and they can live with the consequences
  - Aditya_Garg 5y ago
    Letting crypto scams flourish hurts the ability for crypto to be taken seriously by a lot of people.

Animats 5y ago

Proof of work systems are in trouble. China's government has had it with the power drain. Last Saturday, most of the major Bitcoin mining operations in China had their power cut off. Hash rate is way down. China's Bitcoin miners are frantically trying to find cheap gigawatts elsewhere in the world.

tmarice 5y ago
> Proof of work systems are in trouble. Bitcoin isn’t. Difficulty will adapt and all operations will carry on as usual.
- Animats 5y ago
  The "investing in Bitcoin mining to get money out of China" industry just broke down. That was the high-volume use case.
  - lecarore 5y ago
    Makes sense given the cap they have on how much foreign currency they can buy
    - Animats 5y ago
      Right. China severely restricts sending money out of the country, while encouraging manufacturing and exports. If you're in China and want dollars or euros, make something in China, sell it outside China for a convertible currency, and keep the profits outside China. Bitcoin mining fit that model. It was making something in China and selling it outside China. Not only legal, but encouraged. That just ended.

puranjay 5y ago

I’ve been an ardent defender of crypto as my comment history would indicate. But man the past few months, the doge coin mania has birthed an astonishing amount of scams, rugpulls and zero-utility coins. I really can’t defend crypto at this point at all.

betwixthewires 5y ago
Why not? Every bull market has brought the scams. This isn't just in crypto. How many penny stock scams were perpetrated during the dot com bubble by adding ".com" to the name of a company? Scams are nothing new, scams in cryptocurrency are nothing new, and in all honesty 90% of them are obvious. General rule of thumb, if someone is telling you you can make money by spending some of your money right now, it is probably a scam, if they're saying you can make money by giving them some of your money then it is almost 100% certain to be a scam.
herbst 5y ago
That's self regulation at its best. We had those scams from beginning, the difference this year was the mainstream joining. When tor was full of bitcoin doubler websites I tracked multiple hundred thousand dollars getting burned daily for months until it cooled down. This is like 6 years ago. I guess many back then learned their lesson, so do many others today. Or remember Mt gox? When like half of the active bitcoin market was suddenly lost?
- xrstf 5y ago
  > We had those scams from beginning I tend to disagree a bit. In the early days, most scams at least pretended to have some non-pump-and-dump usecase. Like Dentacoin or Filecoin. You could at least pretend to "buy filecoin today so you can store PB's worth of data in a year" or "buying Dentacoin now because in a year you need some dental work done". Nowadays all new tokens/coins have 0 usecases attached and only exist to be pancake swapped and pumped and separating other people from their money. It's all about lending, yielding, farming, interest rates, staking, ...
  - 5y ago

kemonocode 5y ago

The only reason this is news-worthy is because it's tied to the current hot button issue (cryptocurrency). Scams like these happen all the time during bull markets and the crypto investment maxims (never invest what you're not willing to lose, do your own research and if it sounds too good to be real, it usually is the case) apply just as well in any other kinds of speculative investments. Increasing regulation and adopting that sort of paternalistic attitudes will do nothing except harbor further dissent and widen the divide between the rich and poor, as it always has.