Outlook Money
Fraudulent activities in the crypto market are increasing in India, affecting both new and experienced investors. Awareness of these scams is crucial to protect investments.
According to the Virtual Digital Assets Decoded handbook by CoinSwitch, several types of crypto frauds are prevalent, targeting unsuspecting investors and exploiting gaps in awareness and security.
Fraudsters promise unrealistically high returns, such as “double your Bitcoin in 10 days.” Early investors are paid with funds from new victims until the scheme collapses. Example: In 2024, Telangana police busted a Rs 6.4 crore fake investment app using Bitcoin.
Scammers create fake trading platforms mimicking legitimate exchanges, tricking users to deposit crypto which they cannot withdraw. Example: In 2023, Delhi cyber cell tracked a fraudulent site mimicking Binance.
Groups artificially inflate a token’s price and sell off their holdings at the peak, causing losses to new investors. Coordinated scams often happen via Telegram groups.
Fraudsters send fake messages asking users to “verify KYC” or update wallets. Clicking malicious links gives scammers access to accounts.
Developers create new tokens, attract investments, and then withdraw all liquidity, leaving investors with worthless tokens. Example: Several meme coins disappeared overnight after launch.
Scammers use AI-generated videos of celebrities to promote fake crypto giveaways, tricking users into sending crypto. Example: Fake Elon Musk videos on YouTube were used to steal Bitcoin.
Cybercriminals exploit system flaws or malware to access wallets and steal funds. Example: WazirX lost $235M in 2024; CoinDCX lost $44M in 2025.