The Biggest Cryptocurrency Scams Ever (…So Far)


Cryptocurrencies have been around long enough that we generally know what they are, but not long enough that most of us know exactly what they are or how they work. Bitcoin has been in the news in the recent past for making people rich – or bankrupting them – overnight, though it’s not clear to the layman how it does that.

Simply put, cryptocurrencies are a new form of digital currency that are run and maintained by multiple people instead of one, each adding public details of their transaction to a long list called the blockchain. Or at least that’s what Bitcoin is, as it has – since its inception around 2011 – spawned multiple other coins with different features.

Because of still being in its nascent stages, cryptocurrencies have captured the popular imagination due to their recent rise in value, leading many people to rush to invest the entirety of their savings into them. Of course, much like everything else, it’s not all fun and games, as many people have lost a lot of money during the many market crashes in Bitcoin’s history. 

That’s not the only risk, as this is also an industry full of scams and frauds of various kinds, as the technology isn’t controlled by any central authority. These cryptocurrency scams expose the glaring flaws in the technology of cryptocurrencies, proving once and for all that we’re not yet ready to use it as everyday currency.

8. The Big Twitter Hack

At the time of writing this, the Twitterverse is still reeling from one of the biggest cryptocurrency hacks of all time. The accounts of many major personalities – Barack Obama, Bill Gates, Joe Biden, Jeff Bezos and many others – were recently hacked by an unknown group, and their feeds replaced by tweets asking for Bitcoin donations. Unfortunately, quite a few people fell for it, too.

While we aren’t sure about the exact numbers yet, the scammers are said to have gotten hundreds of thousands of dollars in this scam alone, as apparently quite a few people trust these personalities enough to send them money whenever they ask. While the accounts have been restored to their rightful owners, it’s not yet clear how the hack happened.

7. The YouTube Scammers

Even if cryptocurrency scams have existed for as long as the currencies themselves, they have to keep updating their M.O. to be on top of the scamming market. What would have worked in 2013 is common knowledge at this point, as the recent crypto boom has gotten cryptocurrencies into the mainstream discourse.

That doesn’t mean that scammers are running out of ways to scam people – they’re just coming up with new ways to do it. Take one of these very specific types of scams you’d find mostly on YouTube, wherein a major channel is hacked and their regular stream is replaced by a live stream of someone famous in the crypto field (they even used Elon Musk) asking for a generous donation through Bitcoin. Quite a few big channels – including TopTenz – have fallen prey to this tactic, as it directly targets a wide group of unsuspecting subscribers.

6. OneCoin

As you’ll know by now, Bitcoin isn’t the only cryptocurrency around. Many other coins have tried to replicate its success story, and some have succeeded quite well, as they come with their own technology to solve various problems. Still, most coins in the market have little to no use, and exist only as for-profit business models. That would be fine, too, except many of them are huge scams, with little or no intention of doing what they say with your money.

Just take OneCoin, which started out as a cryptocurrency and had hundreds – if not thousands – of people promote it across YouTube and other social media channels before its launch. They asked people to invest in their educational material, merchandise and other things in exchange for coins, and even had an incentive model for referrals. 

As you’ll have guessed by now, yup: it was a multi-level, international Ponzi scheme. Quite a few people ended up buying it, too, as it looked pretty legit. As it turns out, it wasn’t. By the end, the scammers got away with over $4 billion, which is easily comparable to a major stock exchange fraud. 

5. Bitconnect

You’d think that cryptocurrency scammers have to get creative once in awhile to turn any profit, and they do, as the layman knows more about these coins now than he did around a decade ago. Still, that doesn’t mean that the old ways don’t work at all. It’s still ridiculously easy to use the same script and get at least some people to give you their precious coins. Some new coin claims to solve some arbitrary problem, thousands of people put in their money and buy it thinking someone else will buy it for a higher price later, and the company goes missing with all the money. 

That was the case with Bitconnect, though it ended up getting more successful than most other scams of that nature. While their offer was simple – put in a sum of money in exchange for a fixed amount of regular returns – it ended up getting more takers than usual, something no one can still adequately explain. Many claim that it was due to their quirky marketing, though it may just have been the fear of losing out on a great investment at the height of the crypto bubble. At its peak, Bitconnect was among the top 20 cryptocurrencies, with a market cap of around $2.6 billion.

What will come as a surprise to absolutely no one is that Bitconnect turned out to be a Ponzi scheme, too, and almost all of its top brass is still M.I.A. after they abruptly shut operations and exited the market in 2018.

4. Pincoin and iFan

Pincoin was started by a Viatnamese company called Modern Tech, with one of the biggest launches in crypto history. Around 32,000 people invested over $660 million as backing to the project, which may make it sound groundbreaking. It wasn’t, and was actually another one of the ‘pay and receive guaranteed returns over time’ kind of a Ponzi scheme. 

One crucial difference between Pincoin and other scams is that Pincoin actually started paying people returns in the beginning, making it seem legitimate and getting even more people on board. As you’d expect, they soon stopped the cash returns and replaced them with another of their coins, iFan, before they completely stopped the payments altogether, shortly followed by vacating their offices overnight. We’re not really sure about how much they made, though it’s suspected that the numbers were in the hundreds of millions.

3. Bitcoin Savings & Trust

Bitcoin Savings & Trust was a Bitcoin firm that showed up on online forums back in 2013, back when it was still in its early stages. Started by Trendon Shavers – also known as Pirate – the trust was initially just a Bitcoin bank from which Shavers could sell to other buyers. As business picked up and he required more volume to keep up (or at least that’s what he claims) he started the trust and promised whoever invested in it a consistent return of 7%.

While that worked quite well during the sunny days, the price of Bitcoin doesn’t just go up. As it went through one of its many major crashes, Shavers started finding it difficult to pay people back, and at one point was taking money from new customers to pay back the older ones. Needless to say, the model collapsed pretty soon, as he declared insolvency and faced the court. It may sound like an honest mistake and not a scam, but it was later discovered that he was spending a lot of that money on casinos, fancy cars and other indulgences. All in all, New York prosecutors calculated that he had made over 146,000 Bitcoin from the scam, which comes out to be around $1.3 billion at the time of writing this.

2. The Silk Road Auction Scam

The Silk Road was one of the biggest digital black markets to have ever existed, and was powered by the anonymity of Bitcoin. At its height, some of the biggest countries and security forces around the world were looking for the team running it, as it ran on an anonymous, untraceable network called Tor. At the end of it, it wasn’t the technology that gave it away, but the stupidity of its founder.

Understandably, when its assets were seized, the authorities found and seized a lot of Bitcoin. They decided to auction them and emailed everyone who had previously shown interest in buying them, except they used CC instead of BCC. The now-public list was already shared around the Internet before they even realized their mistake. Quite a few of those customers were scammed, too. While we don’t know the full extent of this crime, at least one customer lost 100 Bitcoin in the phishing attack, which is worth around $900,000 right now.

1. Mt. Gox

If you haven’t heard of Mt. Gox, you may be new to the cryptocurrency space. It was a cryptocurrency exchange based in Japan which – at its height around 2013 – was responsible for around 70% of all the Bitcoin transactions in the world. It would have continued to be the biggest player in the market today, too, if not for its infamous hack back in 2014.

All in all, around 800,000 Bitcoin were stolen from the Mt. Gox Bitcoin wallet, though the details of exactly what happened are still fuzzy. It was the biggest setback to Bitcoin since its inception, as 600,000 of those Bitcoin – worth around $5.5 billion today and a huge chunk of the total supply – still remain lost. While Mt. Gox declared bankruptcy soon after the fiasco, the hunt for the missing Bitcoin is still on.

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