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Cryptocurrency Scam Built on a Scam

If you’ve been sitting on the sidelines during the crypto-mania that produced 2,142 new crypto currencies and saw a huge runup in the price of bitcoins and others, congratulations. You missed out on a market drop that exceeded the stock market decline in 2008-9. You may have also missed out on the adventure of having your online “wallet” pilfered by more experienced crypto-investors.

Cryptocurrencies are like dollars, yen or euros, except that unlike those more mainstream currencies, cryptocurrencies are not backed by any government. They are also not accepted at most retail establishments, and their value can change dramatically from day to day. If you’re not buying illegal firearms or recreational drugs, then normal currencies are definitely the way to go

Except that many people apparently believe that bitcoins, ethereal, XRP, EOS, Litecoin, Binance Coin, Tether, Stellar, Cardano, TRON, Monero and, well, more than 2,000 others are now investments. You can see the list of investment “opportunities” on the coinmarketcap.com website—and notice that many of them have no actual circulating supply that anybody knows about.

It’s hard to imagine that there is a worse investment in this world, but recently we’ve become aware of crypto-opportunities which virtually guarantee that you will lose all of your money. Recently the U.S. Securities and Exchange Commission issued a warning about fraudsters who tout a cryptocurrency advisory and trading business. They will invest your funds in “mining” farms that will (they say) provide guaranteed returns of 20-50% with little or no risk. In addition, some investors are assessed up-front “taxes” and/or the costs to extract fake profits from the investment.

Of course, there are no guaranteed high investment returns in this world, but the allure of crypto cash as a new, exotic investment seems to have attracted gullible “investors.” In the warning, the SEC announced indictments against two Nigerian citizens on one count of conspiracy to commit wire fraud and eleven counts of actual wire fraud. They were affiliated with three websites: wealthcurrency.com, boomcurrency.com and merrycurrency.com.

Your best approach is to avoid any cryptocurrency “investment opportunity,” but this is especially true when returns are “guaranteed.” If you suspect that you’ve been contacted by a fraudster, you can call the SEC at 800-732-0330, or email the enforcement division directly at help@SEC.gov.

Please Note: This article is used with permission from a newsletter to which KFG subscribes. It is for our clients only and may not be republished.

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