Scams and frauds have been rampant in the crypto community for many years now. The crypto market, being relatively unregulated, has attracted so many scammers and fraudsters. These criminals take advantage of the lack of knowledge among investors to leverage their schemes.
One of the most common scam is the Ponzi Scheme. I'm pretty sure most, if not all of us are very familiar with this scam. In a Ponzi Scheme, the scammer promises high returns on investment without doing any actual trading. Instead, the scammer gains new participants mostly true referrals and uses their funds to pay the earlier investors' promised profits. The Ponzi Scheme collapses when new participants dwindle or demand a payout, and the scammer disappears with the remaining funds. There's something my dad always tells me, " there is no such thing as something from nothing". Anyone that promises you a particular amount of BTC, and all you have to do is invest a particular amount or share their link to invite a given amount of people, that person is a scammer, and potential investors should avoid them at all cost.
Another common scam is the Fake ICO (Initial Coin Offering). In Fake ICOs, the scammer promises a new cryptocurrency with a major technology or platform, convincing potential Investors to invest their funds in the ICO. However, after collecting the funds, the scammer disappears, and no new cryptocurrency is ever launched. Personally I've been a victim of something similar to this some time ago, but it wasn't crypto related.
Another fraud is the Phishing scam, where a scammer creates a fake website that pretends to be a popular cryptocurrency exchange or wallet. They ask for login credentials, private keys, and then proceeds to access the victim's cryptocurrency wallet and steal their funds.
Lastly, the Ransomware, here the scammer captures a victim's digital devices or files; the attacker demands payment in cryptocurrencies to surrender the data and restore access to the victim. Another one that's very similar to this, the scammer preys on investors that have issues with their wallet, offers a solution and demand for their login details to fix said issue. Then they proceed to access their wallet and steal their funds.
A few days ago, a user on this forum asked if it was possible to reverse a bitcoin transaction cause he accidentally sent funds to the wrong address. That's the kind of post these scammers look for. I'm sure he got a couple of messages from people claiming to have a solution to his issue.
To avoid scammers like this, Investors should also be wary of promises of unusually high returns and do not disclose any personal information or keys to anyone.
Finally, Investors should use secure software and hardware for their devices and regularly back up their data.