What Some People Will Do To Secure & Turn A Cryptocurrency Profit
Cryptocurrency seems to be a huge topic as of late with various governments around the world dealing with fraud, scams, or investment schemes gone awry. This is bound to be the case with a currency that is digital, worldwide, always changing in scope and value as well as one largely unregulated in much of the world. Crypto mining is particularly noteworthy in this regard and some of the schemes people go to in order to mine for Bitcoins, or other cryptos, and strike it rich are mind-boggling. As there is a finite supply of Bitcoins and some of the other cryptos that are mined, it becomes that much harder and system intense to mine additional coins over the long term. However, this does not stop the schemes and attempts to harvest server farms for this purpose.
The return on investment (ROI) with each successful digital coin mined becomes very profitable as Bitcoins, for example, are sold for $6,278 as of this writing. However, The Next Web reports that at least lately it has become unprofitable for many companies hence why many are disappearing or pulling scams. The amount of effort in resources is vast for Bitcoin mining right now. Supercomputers and government installations have even been used on occasions for this purpose. With such high stakes also comes high risk and people who lost fortunes or were scammed out of fortunes.
Savvy hackers and network operators around the world are also taking advantage of this crypto opportunity present today. South Korea is one country that has recently been making headlines in this regard, but it is just one of many with an interest in cryptos and individuals willing to do what it takes to take advantage of an unregulated in some cases, or semi-regulated, economy.
„Phishing emails were sent to a total of 32,435 people, leading to the infection of 6,038 machines,” according to the report. „These PCs were infected with malware through phishing campaigns which sent fraudulent emails masquerading as job application documents.”
that is a lot of infected systems right there and many of these users probably had to deal with significant downtime or slowdown on their systems for a period of time the mining took place. Because mining is a system taxing affair. They also infected these machines with scripts without user knowledge and even used a covert scheme masking as job application emails.
The scheme’s profits amounted to around a 1$ million between the group and four have been already apprehended. They are expected to stand trial for this scheme. However, crypto mining isn’t the only recent scheme South Korea has had to deal with related to cryptos. In a different crypto fraud scheme, a startup has decided to take an. exit route while taking their customers’ crypto funds with them.
„Blockchain company Pure Bit has seemingly walked off with $2.7 million worth of investors’ money after raising 13,000 Ethereum in an ICO,” according to The Next Web. “Transaction history shows that hours after moving all raised funds out of its wallet, the company proceeded to take down its website. It now returns a blank page.”
To those unfamiliar with crypto startups and what the term ICO or initial coin offering, it is basically a way for startup tech companies get funded using cryptocurreny that is offered to investors as tokens. These tokens help companies grow (crowdfunding is often involved) and secure enough funds to actually launch their project and this is supposed to occur when their funding goals are met. Investors pouring in funds to the startups end up receiving these tokens at the exchange of legal tender or other more established cryptos, such as Bitcoin and Ethereum. This occurs at the beginning of the ICO announcement and more often than not the value of these token offerings would rise incredibly over time.
However, as we see in the case of this Korean ICO exit, the practice also left some investors in deep waters as fraudulent companies or startups claiming they are something than they really aren't, or offering a service they really have no plans on implementing, were created in some cases with the idea of running away with investor funds rather than build successful brands from crypto-based investment.
Pure Bit seems to have planned their exit strategy well ahead of time. According to TNW's report, its main website and social media accounts were deleted with all users kicked out of its KikaoTalk chat service. Obviously, there is always risk in investment particularly in startups or companies without a track record, but it seems that cryptos have had a bad rep this year in this regard. TNW even reported a study conducted that showed scammers taking more than $100 million worth of cryptocurrency over the last two years.
Because of these issues, cryptos are becoming more and more regulated around the world with various government entities coming down on the digital economy. What was once a dream of an unregulated and worldwide digital currency is becoming much less of a reality as more governments get involved. Depending on who you talk to, this can be seen as both a drawback and a much-needed reaction to the fraud.
Thailand's Securities and Exchange Commission (SEC) is already getting involved in the approval process of each ICO, according to a report from Bangkok Post with a regulatory portal involved in the process. This will cause each ICO to be vetted case by case and may delay many startups from their much-needed funds. Likewise, the Bahamas are also a country looking into implementing various regulatory practices related to ICO fraud and cryptocurrencies.
According to The Nassau Guardian, the Central Bank of the Bahamas (CBOB) released a regulatory framework in dealing with crypto-based assets that will be invested into the financial service industry. CBOB mentions standards-setting bodies (SSBs) including the International Monetary Fund (IMF) as key players in this regulation and some of the mentioned fraud includes cross-border transactions with anonymous crypto assets and tax evasion.
Bitcoins and cryptos have even seen other sorts of scams recently and criminal activity such as Google's official Twitter feed hacked with a fake giveaway, as reported by The Next Web. Other major companies were also victims of a similar hijacking of social media accounts with fake giveaways being touted in exchange for customer information or funds donated.
People are also willing to go to extremes to get their justice or funds back after becoming victims of fraud or losing fortunes in investment. There is a recent case of an Indian teen threatening the FBI for not helping him track down someone who defrauded him from the U.S. He was apprehended after threatening to blow up a Miami airport.
Despite governments and financial institutions wanting international crypto regulation and monitoring of transactions, the ideas behind cryptos originating were almost the direct opposite of this. There is sound need to protect people from fraud and losing their entire life savings, but it has to be done right and not at the expense of People wanted to be free from the burden of government interference or the interference of international financial institutions from monitoring and controlling their ability to invest and spend their currency the way they see fit. But like anything that becomes too well known or profitable, it will not remain anonymous for long. And as the criminals and fraudsters find their way, so will regulatory bodies.