CryptoRom is a malware campaign which combines crypto scams with a method of catfishing. In recent years, CryptoRom scammers have hugely improved their techniques and are now able to leverage new features on mobile devices, partly the reason why they managed to place scam apps onto Apple and Google stores in this instance. 

But, with so many processes in place, how exactly were these crypto scam apps able to find their way onto these highly protected stores? Let’s take a look at the CryptoRom scam and the intricacies of these crypto scam apps. 

What Were The Crypto Scam Apps? 

The CryptoRom scam apps that were able to be placed onto the Google and Apple app stores were called Ace Pro and MBM_BitScan. Although these crypto scam apps are fraudulent, the real question is how they managed to appear on the App stores in the first place, which are usually protected and governed by very strict security protocols. The crypto scam apps are immune to Apple’s Lockdown mode, which was designed to protect users from sophisticated engineering that is typically used in pig butchering scams. 

It is notoriously difficult to get malware past the security review processes used by both Apple and Google, which is why the appearance of these crypto scam apps on the app store is a concern. Now that scammers know it can be done, this brings the potential that other scammers will try to infiltrate the app stores, as has happened in the past.

These crypto scam apps tend to use cryptocurrency as one of the main clauses as, unlike fiat currency, cryptocurrency payments can be irreversible and hard to trace, meaning that in most cases, victims won’t be able to get their money back on their own. This is where our team can help. We use specialist tracing services to identify the final wallet destination of your cryptocurrency and then do the work to recover the lost funds. 

How Did The Crypto Scam Apps Work? 

With the Ace Pro crypto scam app, scammers created and maintained a Facebook account of a woman who was supposedly living in London. The malicious crypto scam app, which was disguised as a QR code scanner, directed users to a remote site when it was originally uploaded to the App Store. Then, both Ace Pro and MBM_BitScan were connected to the same command and control which was designed to deliberately impersonate a legitimate cryptocurrency firm in Japan. 

Victims of both scams were approached through applications, including Facebook and Tinder, and they were then asked to move the conversation over to WhatsApp after initial contact – a common sign of a CryptoRom scam. They were then lured into downloading the crypto scam apps. The highly intricate profiles and backstories the scammers create only add to the legitimacy of the scams, especially when paired with the fact that these crypto scam apps were added to the official app stores. 

What Are Pig Butchering Scams? 

The term pig butchering comes from the strategy scammers use that involves “fattening up” victims before the “slaughter”, or in other words, conning them out of their money. This scam is by no means a new form of scam and is a type of long-term fraud which combines things such as crypto scam apps, investment schemes, romance scams and cryptocurrency fraud into one conglomerate. The name pig butchering scam has been given as scammers will cruelly refer to their victims as pigs, before “butchering” them for their money. 

Pig butchering scams will involve a standard scam approach with an initial text, social media message or forum chats on things such as job boards. Once the scammer has initiated contact, they will begin to slowly build a relationship and, in some cases, may even look to spark a romantic relationship, which is why this type of scam is closely associated with CryptoRom and romance scams. This will usually always be done through text messages or other online messaging forums. 

At some point, the scammer will introduce an investment opportunity and will use a fake crypto platform in order to show some sort of evidence as to their returns. Victims may then “invest” and see false strong returns being generated, however, their money is going to the scammer in reality. When the victim runs out of money to invest or they try and withdraw funds, the scammers will block the victim. This type of scam unfolds over months, with the scammer slowly gaining the trust of the victim and learning how they can exploit vulnerabilities, like those of Ponzi scams. 

Why Is This Scam Different? 

Even though there is little this time that is different from other CryptoRom scams, the biggest difference with this instance is the fact that the apps were able to be wrongly added to the Google Play and Apple App stores. This means that there was a higher chance of more people falling victim to the scam by downloading the crypto scam app, rather than those who were already in contact with the scammers. Apple and Google are strict when it comes to removing and disallowing malicious apps, so it is surprising that in this instance, these two managed to get through. 

In the past, hackers developed ways to get around conventional security testing and it is known that CryptoRom has previously used the actual Apple Developer Program and Enterprise Signatures. Now, these hackers are taking full advantage of two new iOS features. One of these is TestFlight, which is a feature that app developers use in order to distribute beta versions of their apps to testers and it can be easy for app authors to abuse, such as in this instance. 

How To Avoid This Type Of Crypto Scam App

CryptoRom and other pig butchering scams yield high results for scammers in a relatively short space of time, meaning that more and more scammers become incentivised to carry out this type of scam and put more effort into gaining the trust of their victims, in order to receive more in return. What makes this type of scam different from other forms of online and cryptocurrency scams is the lengthy engagement which is involved, from the initial withdrawal to the fake crypto scam apps, and which then makes it hard for the victim to see through the scam. 

People’s trust in apps and software tools has grown substantially over recent years and when apps are able to be sourced from official Apple and Google stores – trustworthy names in the tech and global industry – it adds additional legitimacy, which is what makes the case of these crypto scam apps so potentially damaging. 

Before installing an app onto your device, always check the reviews and read the privacy policy, developer details and information on the company fronting the app. With cryptocurrency, our team can help if you believe you have lost funds to a crypto scam app or another crypto scam. Contact us today to arrange a free consultation. 

Authorised push payment (APP) fraud has become one of the more significant types of fraud and scam in recent years, both in the UK and across the globe. Push payment fraud continues to have a hugely devastating impact on victims and, in the last year alone, losses have totalled almost £500 million. 

In May 2022, Treasury announced that it has the intention to legislate in order to allow PSR to require victim reimbursement for authorised push payment fraud. These new requirements will set a change in the way that push payment fraud reimbursement will work.

With so many people being affected by authorised push payment fraud, our latest blog looks at the changes introduced to the payment requirements and what these changes could mean for victims of authorised push payment fraud. 

What Is Authorised Push Payment Fraud? 

Authorised push payment fraud is when someone is tricked into sending to a scammer who poses as a genuine payee. This type of fraud happens to thousands of businesses and individuals each year and the latest figures have shown that in 2022, £485.2 million was lost to authorised push payment fraud through 207,000 reported cases. 

PSR has said that it expects to see more being done by financial institutions in order to stop authorised push payment fraud from happening and hopes to see better protection for people if they do fall victim to this type of fraud. There are roughly 8 different types of APP scams, with 2 main objectives:

• Malicious Payee, where people are tricked into purchasing goods or services which don’t exist or are never received. 
• Malicious Redirect, which is where fraudsters impersonate bank employees in order to get someone to transfer money from their account to that of the fraudster. 

What Are The New Payment Requirements?

• There will be new rules in Faster Payments, which is where the majority of advanced push payment fraud occurs. 
• All payment firms will be incentivised to take action following reports of authorised push payment fraud. 
• Customers will be more protected using consistent standards, with most victims being reimbursed within 5 working days, as well as having additional protections offered to more vulnerable customers
• The industry will have clearer guidelines in which they are to follow, largely around how to apply a claim excess and the maximum amount of reimbursement. 

These new rules will be imposed on the system which handles Faster Payments, which is where the vast majority of authorised push payment fraud (around 90%) has occurred, with reimbursement requirements coming into effect next year. It has been said that all payment firms will now be incentivised to take action following authorised push payment fraud being reported. 

It’s important to make clear that this only focuses on APP fraud and other payment systems, including cheques, BACS, Mastercard and Visa will not be covered under these new rules and requirements. 

PST is also looking at a wider range of changes which should:

• Lead to the publication of data later in the year which shows how well businesses are protecting their customers. 
• Continue with the widespread rollout of Confirmation of Payee which is the name-checking service that has been designed to help prevent authorised push payment fraud.
• Support and encourage the creation of improved intelligence to help spot fraudulent transactions.

Next Steps

When these changes are implemented, they should give everyone across the payments system the initiative to act when it comes to preventing authorised push payment fraud from occurring in the first place. These changes put the UK right at the forefront of the global fight against authorised push payment fraud. 

In terms of what happens next, there is a timeline of actions planned for the future.

In July, PSR will consult on the draft legal instruments in order to put the reimbursement requirements in place.

In August, PSR will consult on the maximum level of claim excess and reimbursement which can be requested following authorised push payment fraud, as well as further guidance on the customer standard of caution. 

In October, PSR will provide the final legal instructions to Pay.UK and offer further consultation to PSPs. 

By the end of 2023, PSR will publish the claim excess and the maximum amount of reimbursement offered, as well as further guidance on the customer standard of action. 

In 2024, the new reimbursement requirement will come into effect. 

As well as reimbursement, PSR is also set to increase the level of transparency through the publication of data as to how well businesses are protecting customers from fraud. 

How To Get Money Back Lost Through Authorised Push Payment Fraud

There are two different types of fraud – authorised and unauthorised. Under the PSR rules, banks must refund victims of authorised push payment fraud in full, as long as they haven’t been grossly negligent. If your bank refuses a refund, then you can complain to the financial ombudsman. At WRS, we’re happy to offer advice if you have lost money through authorised push payment fraud, or other online scams. Contact our team today! 

Who Are BDSwiss?

BDSwiss has been established since 2021 and has provided CFD and forex services to more than 1 million investors. The firm has experienced dramatic growth trajectories as well as won multiple awards for its services and products. 

Throughout the years, BDSwiss have had a range of partnerships with brands and sports teams. Since 2021, they have been sponsors of the DP World Tour Championship, AVIV Dubai Championship and the MercedesCup ATP 250. 

They also sponsor local football teams and even some cycling teams. This all encourages investors into thinking they are legitimate investors but are they? Is this just a smokescreen for what is happening behind closed doors? 

Is BDSwisss Legitimate?

Scammers use a range of different methods to part you with your money, but online trading platforms are one of the most lucrative and recurrent methods that scammers will use. It’s pretty easy for a brokerage firm to tick all the required boxes, but if you know what to look out for, there are some red flags that they hide from investors. To evaluate whether BDSwiss is legitimate, it’s important to get an overview of the services and products they provide, its regulatory status and how they use its data. 

BDSwiss Background

The company claim to specialise in multiple formats including shares, forex pairs, metals, energy, ETFs and indices. Since June 2020, the company has had over 1.5 million registered investors with a trading volume of $84 billion. BDSwiss had its first office in Berlin in 2012, but now it also has offices in Seychelles and Mauritius which are listed as its current address. It is now present in over 10 countries and draws clients from over 186 different countries.  

Who Regulates BDSwiss?

BDSwiss operates under BDSwiss Group which has licenses from various regions including:

• BDSwiss Holdings Ltd is authorized and regulated by the Cyprus Securities and Exchange Commission under CySEC license number 199/13.
• BDS Markets is regulated as an investment Dealer by the Mauritius Financial Services Authority (FSC).
• BDSwiss GmbH is registered by BaFIN in Germany.
• BDS Ltd is regulated and authorized by the Financial Services Authority (FSA) in Seychelles, license number SD047.

As you can already see, BDSwiss is not regulated by any reputable regulatory body like the FCA. This raises many questions and red flags as many of the regulatory bodies they are registered with have very loose rules which are extremely risky for their customers. 

BDSwiss Red Flags

Although BDSwiss is regulated by some bodies such as CySEC, the firm has been in trouble in the past which, of course, sends red flags to people like us. We investigated and it seems that in 2017, CySEC fined BDSwiss for €150,000 for violating market laws. CySEC also gave them an administrative fine of €5,000 for not complying with the laws in 2016. 

Let us ask you this, would you be comfortable investing your money with a company that has been fined twice for not abiding by the law? For a company to have been fined twice by regulatory bodies shows they are not operating in a legit manner and are not following the rules and regulations in place.

Negative Customer Reviews

There have been many reviews from previous customers of BDSwiss, but overall the reviews outline two main areas that stick out a lot. These are:

• Customers make withdrawals but don’t receive their funds.
• High spreads and manipulation of the price – make it hard to profit from trades.

With these two elements being the main focus on bad reviews, it’s easy to say that you should stay clear of this company at all costs.

Multiple Addresses 

BDSwiss has multiple entities that operate in many regions. Due to them having this, they claim to be regulated by multiple bodies in Seychelles, Mauritius, Germany and Cyprus. According to the CySEC website, the address is for Limassol in Cyprus, but the BDSwiss website has a Mauritius address. Multiple addresses are very confusing.

The worst part of this is none of the regulatory bodies is strict as well as their offices are in offshore zones which makes it much easier to find loopholes to scam investors. A legitimate company will have one traceable address. 

Final Verdict

If you are new to investing forex or any other form of investing, it is best to stay away from BDSwiss. With customer reviews outlining that they don’t receive the funds when withdrawing, as well as making it extremely hard to profit from your trades, it is easy to see that there are some illegitimate processes in play. Combined with the fact that they are not registered with the FCA, it would be much safer to go with a broker that is.

If you have lost your funds from a forex scam or other from an irregulated broker, then speak to us as we will be able to help recover your losses. BDSwiss is one of, if not the most, common brokers that we deal with and we settle many cases against them, without any court intervention. We also offer a no win, no fee process. Contact us today and we can discuss your recovery process. 

NAGA Global Review

NAGA was established in 2015, the company had a mission to provide user-friendly and efficient trading options for beginners as well as professionals. NAGA is an official trademark of a German-based Fintech company called The NAGA Group AG, which has been listed on the Frankfurt Stock Exchange since 2017. In August 2021, NAGA had a global partnership with the Spanish football team Sevilla FC. This was then unveiled as the new shirt. 

Is NAGA Genuine?

To answer this, we will be looking into the company’s products and its operations. We will also look at whether it is regulated and who by.  

NAGA Company Profile

NAGA trades with stock CFDs, forex, indices, futures, commodities and ETFs. The website says that they have over 1 million traders, but it is unclear as to how many of these are happy customers. NAGA also created NAGA Pay, which is a mobile banking and investing app which allows users to trade, save and spend all in one place. 

What some people don’t know is that NAGA is under a parent company backed by Fosun Fintech which is also the majority shareholder. NAGA is based in Germany and appears to be regulated in a range of jurisdictions across the world. 

Who regulates NAGA

NAGA has a range of licences throughout the world. It has a license as NAGA Markets Europe Ltd and is regulated and authorised by the Cypriate Securities and Exchange Commission (CySEC) under licence number 204/13. NAGA also have other subsidiaries including:

• NAGA Global (SV) LLC, registered in James Street, Kingstown, VC0100, Saint Vincent & the Grenadines.
• NAGA Technology GmbH, registered in Hamburg, Germany.
• NAGA Global (CY) Ltd, is now registered in Cyprus.

CySec covers EU clients, but the affiliate company is registered in Saint Vincent & Grenadines as they don’t have strict regulations. 

Offshore regions like these attract a lot of scam brokers as the licencing is nowhere near as strict. Brokers find it much easier to obtain a license easily. Regulations are minimal and the requirements are less to set up. As a trader, you are at a much higher risk of losing your funds when a company has this type of offshore account. 

Red Flags That NAGA Is Not The Company They Claim To Be

The website is very good at looking legitimate, as it offers the following:

• Customers can deposit funds with a range of payment methods. 
• Well-known trading platforms including.
• Free education tools and an economic calendar.

There are many red flags that should be considered:

Customer Reviews

Even if a website looks amazing, this doesn’t mean that they are legitimate. It pays to look at customer reviews in great detail when you are looking at investing money. Although NAGA portrays itself to be a legit broker, reviews from customers show that the firm could be scamming people. 

Trustpilot has a high review rating of 4.5/5, but many of the 5-star reviews appear to be fake. 

Many of the past reviews label the firm as a fraudster which results in a loss of large budgets. 

Offshore Regulations

Whilst CySEC authorises NAGA, the company affiliates are not covered by the regulations and laws. Due to the registrations in offshore locations, it presents a high opportunity for a financial loophole to make it all too easy to lose customer funds. CySEC laws do not cover investors outside the EU and from many of the reviews, it shows that NAGA do not operate like a regulated company. 

Restrictions

When looking into the company in more detail and visiting the Financial Conduct Authority, NAGA only has a temporary operating license. NAGA indicates that it does not cover the UK, USA, Canada, Vietnam and Isreal. The reason for this is that these countries have strict regulations which show the company is not allowed to operate in these countries due to it being a scam. 

Conclusion

Following this review, it shows that NAGA is operating in a way where the money lost through trading can be recovered. With the numerous negative reviews offshore regulations and restrictions show that the firm is untrustworthy. If you have been a victim to a broker scam or other form of scam from this company, we can help you to recover those losses. Losing your hard earned money can feel sickening and we want our clients to feel like they have someone on their side. Contact us today and we can discuss the process to get this journey started.  

DeFi stands for decentralised finance and is pronounced as dee-fy. This is becoming increasingly popular due to it being able to cut out the intermediary when making transactions which in turn goes straight to the intended person. This has of course gained popularity due to it being an alternative to traditional financial services. DeFi lets you do most things a normal bank offers as well as other centralised finance companies. In this blog, we will answer what is DeFi and how it differs from centralised banking. 

What is DeFi

Due to this being relatively new, many people are wondering what DeFi is and why is it getting so popular. DeFi refers to decentralised finance services on blockchains instead of centralised financial services that banks offer. DeFi allows users to use cryptocurrency to provide a range of services that a bank would offer such as lending, borrowing, earning interest and much more. DeFi is faster, more affordable and much simpler it also offers new products and benefits regularly. What DeFi is offering is cheaper and more reliable services than a standard bank. 

What is decentralised finance?

Decentralised finance allows transactions directly to the other person through blockchains. What Defi is allowing you to do is access your assets through a secure digital wallet which in turn enters you into smart contracts to make your transactions. This then lets you have access to a range of financial services such as lending and trading. What is great about DeFi is the fact that it is accessible to anyone with an internet connection making it more accessible and convenient. 

What is DeFi vs CeFi

Centralised finance (CeFi) is the standard financial culture that we all know around the world. This form of financing allows you to borrow, trade and pay through third parties and intermediaries that are heavily regulated. What is different with Defi is the fact that it offers a range of benefits including allowing people to transact through their financial apps through a blockchain. This cuts out the middleman such as the standard bank organisations. 

Removing intermediaries, it in turn reduces costs, makes transactions much faster and makes it more accessible for users with an internet connection. With CeFi, not everyone can open a bank account and they certainly can’t always access other financial services. What DeFi is doing is enabling many people to access financial services which they would not be able to with CeFi. Due to DeFi being constant, you don’t have to wait until your bank is open, you can use the features whenever you want. 

What is Defi Smart Contracts?

Smart contracts are contracts that are self-regulated on a blockchain. Each peer in the contract will implement their own terms and conditions which allows the contract to be formed without the intermediary. Smart contracts use code and are formed with simple rules such as “if equal to… then this should happen. Smart contracts are automatic if they meet the terms and can be used for a range of features such as sending funds to accounts on a certain day or time. In essence, What a DeFi smart contract is doing is the same as CeFi, but it is more secure, efficient and transparent. 

How Does DeFi Work?

What DeFi is doing is using smart contracts to enable people in the decentralised finance ecosystem to transact directly with one another. These transactions are protected through a blockchain. Many DeFi products allow you to always remain in control of where your money or assets are going. By using DeFi, you can access funds or your asset using your digital wallet. When you are wanting to transact with someone, you can do this through your smart contracts where you and the other parties form conditions to meet before the transaction is made. 

An example of what is DeFi would be if you were wanting a regular payment to an account, this will continue on a regular basis if there are enough funds in the account. Once a contract is formed, it can’t be altered or moved to a different account, so it is extremely important to set it up right the first time. DeFi is built on the Ethereum blockchain and is still in its beginning stages which means new products and services are available regularly. 

What is DeFi? – Current and Future Examples

The Ethereum blockchain is fantastic for sending digital assets around the world in a matter of seconds. There are many benefits of the Ethereum blockchain and there is much more to it than just the standard borrowing, lending, saving and earning interest on your cryptocurrency. Traders will mostly have control of their own wallets, but some may use brokers or private investors. If you have been scammed by this, contact us today and we can help recover your losses. 

What is DeFi Currency Exchange?

DEXs (DeFi currency exchanges) are platforms that allow traders to exchange cryptocurrency with their peers. DEXs allow direct trading between peers without the intermediary whilst also being completely anonymous. By having a private key, users can access multiple cryptocurrencies.   

What is A DeFi Stablecoin?

Stablecoins are tied to stable currencies or assets such as gold. They aim to remove and remedy the instability of digital currencies. These stablecoins are much less volatile and are used for everyday transactions rather than using volatile cryptocurrencies. They are very easy to transfer across the world which also makes sending large amounts of money much cheaper and faster whilst also enabling users to earn interest. 

Conclusion

If you are wanting to start with DeFi beyond trading cryptocurrency, you should do so with care and be sure they work reliably with other peers. So, what is the benefit of DeFi? Transactions are cheaper, faster, and more secure and they can be used for a range of different services. It is extremely important that you create your contracts properly and never give anyone your long password for your digital wallet.

The world of investing has been rife for a couple of years now and the terminology that has been created around it is complete jargon to most. If you have just started out investing, there are two phrases that you should learn off the bat. The bull run and the bear run. Whilst both terms are used to describe the performance of a market, they are completely different and can impact your decision-making. So in this article, we will go through what is a bull and bear market. 

What is a bull and bear market?

When talking about the performance of markets, people wonder what is a bull and bear market. These terms describe how markets are appreciating or depreciating in value. For people who have not heard of these phrases, this part is for you. 

What is the difference between a bull and bear market?

Knowing what is the difference between a bull and bear market is easy to understand. A bull market is a market that is ascending and on the rise. This shows that the conditions of the economy are favourable. A bear market exists in an economy where it is on a downward spiral with most stocks decreasing in value. 

A bull market is represented by a continued increase in prices. For example, the relation to equity markets. A bull market signifies that there is a rise in a company’s share prices. When this happens this usually also shows the country’s economy is strong and also employment is high so investors often believe the uptrend will last a while. 

So what is the difference between a bull and bear market you ask? Well, the difference is that a bear market represents an economy that is on the decline. It is important to understand that a bear market is only a bear market when the market has fallen by at least 20% from recent highs. When a bear market is apparent, share prices, cryptocurrency prices and other assets all drop continuously. This then results in a downward spiral where investors believe this will continue. This in turn speeds up the spiral of the economy which in turn results in high unemployment and people saving their money. 

What is the characteristic of a bull and bear market?

Yes, a bull and bear market are descriptors of the way the economy is moving, but there are also characteristics that investors need to understand. 

Supply and demand for securities

When a bull market is apparent, there becomes a high demand for securities but also a weak supply of them. So this means that investors want to buy them, but nobody wants to sell them which in turn increases the share prices making it even harder to obtain these securities. When it comes to a bear market, this completely changes where people are wanting to sell them, but nobody wants to buy them. 

Change in economic activity

Many businesses’ stocks are being traded on the exchange which makes them part of the greater economy. This makes it easy to understand that the stock market and the economy are strongly linked. 

What is a bull and bear market change in economic activity?

A bear market happens when a weak economy is apparent. Many businesses struggle to make large profits and struggle to stay afloat. This happens because consumers are watching their money and are more reluctant to spend their money. The decline in these profits corresponds directly to market stocks. In a bull market the opposite, people have more money to spend and are less reluctant to send their money. This in turn drives the economy and strengthens it. 

What is the method of trading in a bull and bear market?

So now you know what is a bull and bear market, its now time to understand what to do in each market. In a bull market, it is pretty easy to take advantage of the rising prices of the stocks by purchasing early on. This is why it is important to follow groups as this will help to determine when to invest. Once these stocks have reached their peak, sell them. During the bull market, you may occur some losses, but should only be minor, and you will recover fast. This makes it easier for investors to invest more equity without having to worry about not making a good return. 

In a bear market, things get more complicated as the chances of big losses are much more likely due to the prices continuously dropping and depleting and the end has no real sight. Even when people think they can see the upturn, chances are when investing in a bear market you will make a loss before anything alters the direction. So when people are trying to invest in this market, they are after securities which as discussed earlier, everyone is hesitant in selling. 

Conclusion

Both bull and bear markets have a significant influence on your investments and your profits, for this reason, it is essential for you to do your research and see how the market is before investing. 

Cryptocurrency has been a hot topic for a while now and more people are interested in trading than ever before. The issue with this is that many people have had acquaintances that have made some extra cash and then feel like they can simply jump right in with investing. This is a dangerous move and it is definitely worth doing your thorough research and learning the basics, such as what affects the value of cryptocurrency? In our latest blog, we will do just that, we will go through some of the factors that influence the price of cryptocurrency. 

What Affects Cryptocurrency Value?

Node Count

A node is a computer that is connected to another computer that follows rules and shares information with each computer connected. This helps to synchronise blockchain. The node count shows how many wallets are connected to the same network or blockchain. This is not hard to find as you can simply Google the network and it will show you. 

Alternatively, you can visit the currency web page and it will tell you there. What affects the value of cryptocurrency from the node count is that it shows how strong a community is. The higher the node count, the bigger the community which offers demand, which in turn, increases the value of cryptocurrency. What also affects the value of cryptocurrency is the fact that high node counts also indicate the strength and decentralisation of a network. 

Tip: Before investing in a currency, ensure you check that it is priced reasonably. You can do this by looking at the currency node count as well as the total market capitalisation. Once you have these figures, compare them with a popular or strong currency. This is not 100% accurate, but it can give you a good idea of whether it is a good deal or not. 

Production Cost

The production cost is also what affects the value of cryptocurrency. Each day, miners will use bespoke hardware and specialised servers to create new tokens and confirm new transactions. Once a transaction is verified, the miner will be rewarded with virtual tokens and a fee for their work. 

The network activity from miners is how cryptocurrency persists to work and is also what affects the value of cryptocurrency. This is because if mining costs rise, the value of the currency mostly increases too. This is essential as miners will not be using all of their time and resources if the reward at the end doesn’t cover their expenses whilst also having a reward for themselves too. (It is important to know that this is not always the case so it is always best to do your own research before committing). 

Crypto Exchanges

When a cryptocurrency is available on multiple platforms, it allows more people to buy the coin which is what affects the value of cryptocurrency. The issue with this is that it also increases the number of people buying and using the currency. If you need more than two exchanges to swap cryptocurrency tokens, you will have to pay a fee for each swap, which in turn, is what affects the value of cryptocurrency and increases investment costs. 

Competition

Minors are always looking for new currencies all of the time and some are lucky enough to find them. With new currencies being launched every day it can be extremely competitive. The issue with this is more coins that have no real project or purpose are available and it makes no sense. You can now get meme coins, celebrity coins, sports coins and much more. The good thing about these coins is that, due to the mass production of these coins, at least one of these may get lucky and build a strong network which is what affects the value of cryptocurrency. 

Government Regulations

Many countries have seen how popular crypto trading has become and are very uneasy at the fact the system is decentralised and, worryingly, unregulated. Due to this, the government looks for different ways to control the market. One of the quickest and easiest ways governments have done this is by adding tax to the money people use to cash out, which is what affects the value of cryptocurrency.  Minors and traders are more clever than this though, as it only applies to some coins and not others. Traders simply swap the currency to a coin that isn’t regulated to cash out. 

What affects the value of cryptocurrency negatively is when governments put a complete ban on major cryptocurrencies such as Bitcoin, Ethereum and some other coins. If a country with a large following of crypto users and then regulations change to ban or limit exchanges, it can significantly decrease the value of the coin. 

Social Media

What has affected the value of cryptocurrency in the past is social media hype. It can increase the value as well as decrease the value so it really does affect the value of cryptocurrency in both ways. Influential people to the crypto exchange can significantly affect the value of cryptocurrency. An example of this would be how Elon Musk affected the value of the DOGE crypto coin, nobody knows whether he meant to or not, but it certainly affected the value. 

If you have ever had any issues with cryptocurrency trading and have lost money and it wasn’t your fault, contact us today and we can help recover your losses.

For the past 10 years, there has been much talk around cryptocurrency and, with it being around for some time now, it is apparent that many people have their own opinion on the subject, leading to many cryptocurrency myths floating around. 

Some think it’s the best thing and it is going to take over the traditional currency, whereas others don’t believe that it will last. This is fine, but many people have also got opinions on the topic from myths they may have heard from different people or even on social media. In our latest blog, we will go through 5 cryptocurrency myths to understand before investing and the facts behind them. 

Cryptocurrency Myth – Bitcoin and the blockchain are interchangeable

Fact – Every Cryptocurrency has its own blockchain

The real fact is that many people don’t understand blockchain or what it is, which is where this cryptocurrency myth has derived from. Putting it in its simplest form, it is like a virtual ledger that currencies are built and traded on. When it comes to cryptocurrency, there are some exceptions as each currency has its own blockchain. This means that you would not be able to buy and trade Ethereum on a Bitcoin blockchain and the same the other way around – another cryptocurrency myth. 

It is also important to understand that each blockchain functions differently. For example, Bitcoin was created to work as a form of digital cash whereas Ethereum works as an intermediary for developers to create peer-to-peer apps.

Cryptocurrency Myth – Cryptocurrencies are not regulated

Fact – Each year, more regulations are being put in place

This cryptocurrency myth has derived from some truth as when cryptocurrencies first started, it was a lawless playground, with no laws or regulations in place. This resulted in many people becoming cautious regarding investing as they believed that governments would ban cryptocurrency, rather than regulate it, although some countries did ban cryptocurrency trading. Fast forward to 2022, and there are more regulations in place and governments have now started to look at ways in which they can regulate it.

The reason why they are now being more regulated is the fact that many of the top companies, such as Amazon and Dell, are now accepting cryptocurrency as a valid payment method. This has encouraged more governments to rethink their original plans. So if you hear this cryptocurrency myth, you now know the truth.

Cryptocurrency Myth – Cryptocurrencies are illegal in countries where it is not regulated

Fact – Just because something isn’t regulated, doesn’t mean it’s illegal

Just because cryptocurrency isn’t regulated in some countries, it doesn’t mean that it is illegal – this is a common cryptocurrency myth. If you and your friends developed a currency that you use between yourselves, this isn’t illegal, it’s just unregulated. This is the same for cryptocurrency. If you are worried that it is illegal in your country, it is worth looking around online as there is a lot of information regarding this now. 

A great example of this would be South Africa. At the moment, the South African Bank is working on creating laws and regulations for cryptocurrencies, but at the moment, it is not classed as legal tender. This doesn’t make it illegal, it just simply means that the bank does not support cryptocurrency yet. A lot of traders believe this cryptocurrency myth and this paves the way for error, miscalculated judgement and, in some cases, being more vulnerable to scams and fraud. As with anything, if you are not sure, do your research – our blog has some great tips and advice when it comes to trading. 

Cryptocurrency Myth – The blockchain is only used for cryptocurrencies 

Fact – The blockchain has many uses

A common cryptocurrency myth that people believe is that a blockchain is only useful for cryptocurrencies and that it’s just a wallet for cryptocurrencies. This is also because people don’t have a clue what blockchain is. Instead, a blockchain is a whole platform that provides a range of functions and new features are being recognised constantly. 

One use that a blockchain has is that it can host contracts between more than two parties. This is especially useful if you are storing contracts between loan companies and the beneficiary as well as make the payments automatic. It really is a common Cryptocurrency Myth that the blockchain is only useful for storing and trading currencies. 

Cryptocurrency Myth – Cryptocurrency is going to die soon

Fact – Cryptocurrency has been gaining value steadily over the past 10 years

A common cryptocurrency myth is that the bubble will soon burst. The first generation of cryptocurrencies were generated in 2010, and most of them have steadily grown and gained value during this time. A great example of this is the original currency, Bitcoin. Like with any sort of investment, there are going to be peaks and falls, just like the normal exchange market.  So this cryptocurrency myth is false. 

In actual fact, cryptocurrency is now the fifth most circulated currency in the world and between 2020 and 2021, the increase was over 195% which is very promising for investors.

There are many cryptocurrency myths out there and it can be easy to believe them if you have not already done your own research. If you are in doubt about investing in cryptocurrency, then don’t do it. Once you have done your own research and feel that you are comfortable investing, then the choice is yours. If you believe you may have lost money from investing scams, contact us today and we can help to recover your losses. 

With cryptocurrency only increasing in popularity and scams becoming more and more commonplace, let’s take a look at the mysteries surrounding The Hunt For The Crypto King and what lessons you can learn from the new crime documentary.

Who Was Gerry Cotten? 

Gerry Cotten was a Bitcoin investor from Canada who founded Quadriga CX – the cryptocurrency trading platform – in 2013. In just a few short years, the platform became the biggest of its kind in Canada. In 2016, just a year before Cryptocurrency launched into the mainstream, Gerry took over as sole director. This then resulted in a huge increase in investor interest, some sources say around $1billion went through the company in 2017, but Quadriga soon ran into financial difficulties. 

What Happened To The Crypto King?

As explored in The Hunt For The Crypto King, in 2018 interest in Bitcoin dropped massively. This then led to a number of Quadriga CX customers rushing to withdraw their funds and get their money back. Some investors who held Bitcoin with other investors also transferred their Cryptocurrency to Quadriga CX as, at the time, they could make some money by doing so. But, those who requested their funds back never received it. 

At the same time, Gerry Cotten got married and, whilst on his honeymoon in India, he passed away at the age of 30 from complications of Crohn’s Disease. This sudden news came as a huge shock in the industry, but it also left a lot of questions unanswered, especially for investors who were still waiting on their investment funds to be returned. 

Why Was His Death Surrounded By Controversy? 

When ‘The Crypto King’ died, he was the only person who held the ‘keys’ to Quadriga CX’s wallet, as he had never shared the passwords with anyone else. At the time, there was around $250million in Cryptocurrency that was owned by around 115,000 customers, which was basically unretrievable.

Shortly after the announcement of Gerry’s death, the Quadriga website went offline for ‘maintenance’ and then, soon after, the company was declared bankrupt, meaning that customers had no way of getting their money back. In The Hunt For The Crypto King documentary, some investors stated that they believe Gerry Cotten is still alive and staged his death as a way to defraud customers and get out of repaying them their money. 

There are also some suspicious details that investors were unsure of following his death. In the days before his death, Cotten changed his will and instructed that everything be left to his wife, including a $9.6million estate and a $100,000 trust fund to look after his dogs. Upon his death, his death certificate was found to be misspelt and signed off by police in India with no objection and his body was quickly returned to Canada.

His death wasn’t announced for around a month, but investors later found out on the company website, rather than directly or with any information on what this meant for their funds. The company soon declared bankruptcy, with around $215.7million in liabilities and $28million in assets. 

How Did This Affect Investors?

Shortly after Quadrigo announced bankruptcy, investors who were owed money began investigating the suspicious circumstances. It soon emerged that Cotten and his previous business partner Patryn had a series of connections to Ponzi schemes, also known as pyramid schemes. During this scheme, it was found that ‘The Crypto King’ Gerry Cotten would transfer millions from other investors’ accounts as a way of affording his luxury lifestyle. The accounting firm Ernst and Young discovered this in 2019 when investigating on behalf of concerned investors. 

Shortly after, the Ontario Securities Commission determined that Quadrigo was a scam pyramid scheme and in their report, said that “whether they were aware of it or not, Quadrigo’s clients were exposed to risks beyond fluctuations in crypto asset prices when they chose to trade on the platform”. 

It was found that Cotten took advantage of investors and treated their assets as personal funds which he would spend, use and trade at his own will. He eventually depleted those assets to such an extent that this then took down the company. Although there is no evidence that Cotten is still alive, it is widely believed that he faked his own death to get out of returning funds. 

How To Spot Signs Of Cryptocurrency Scams

Whilst there are a number of legitimate Cryptocurrency trading platforms, there are unfortunately a growing amount of crypto scams similar to that of The Crypto King that are causing investors to lose money. Fortunately, it is becoming increasingly more clear to spot signs of cryptocurrency scams, which can include:

• Being advised how to trade
• Assured a guaranteed profit or return on investment
• Being put under pressure to make a deposit
• Being asked to pay a fee or invest more money 

If you recognise any of these signs, then you may have been the victim of a Cryptocurrency scam. Please contact us today for a free consultation where we can look into ways to recover your trading losses.