Crypto Scams Have ‘Robbed’ Kenyans Of $120 Million Last Year

Crypto scams are victimizing more and more unsuspecting Kenyans.

The cabinet secretary of Kenya’s Ministry of Information and Technology, Joe Mucheru, announced during a conference addressing the threats to law and order in the country that the past financial year, Kenyans lost almost $120 million to crypto scams.

According to reports, Kenyans are being dragged into many of these situations since they don’t have all the right  information.

When it comes to investing and protecting one’s assets, the cabinet secretary asked the media to look into these topics in depth and give readers useful information.

More Kenyans would be protected from bitcoin frauds if more reporters and journalists continue to publish and distribute correct information, the official said.

Prevalent Crypto Scams

Fraud and theft, both of which were conducted mostly via hacking of cryptocurrency organizations in 2021 and which have remained to this day, were the most prevalent types of crime.

However, as of the time of this writing, there is still no available updated statistics on the rate of such frauds for this year.

The North American Securities Administrators Association (NASAA) suggests that people must exercise care before investing in popular and uncertain unregulated investments like bitcoin and other related digital assets.

Related Article | Australian Watchdog Takes Meta To Court Over Scam Crypto Ads

Crypto total market cap at $1.775 trillion on the daily chart | Source: TradingView.com

Crypto investments ‘dangerous’?

Investments in cryptocurrency depository accounts, tokens, trading programs, and mining pools “should be seen for what they genuinely represent” and are “very dangerous, with a great chance of loss,” according to Joseph Rotunda, the vice head of NASAA’s Enforcement Section Committee.

Kenya, like many other African countries, is hounded by these types of fraud disguised as legitimate projects.

In December 2021, for example, a Kenyan businessman was accused of defrauding investors through his Aidos Kuneen cryptocurrency.

According to reports, investors in the businessman’s bogus digital token lost more than $140 million.

Related Article | Central Bank Of Russia Gives Sberbank Authority To Issue Digital Assets

Rug Pulls Among Leading Scams

Decentralized finance refers to financial solutions that are built on top of blockchain technology and do not rely on central intermediaries or mediators.

Investors in the digital currency market have just recently become more interested in it. The development of DeFi systems, on the other hand, carries with it a unique set of transactional and user issues.

Withdrawals from the Decentralized Exchange (DEX) liquidity pool are a kind of exit fraud in which software developers abandon a project and flee with investors’ funds by withdrawing the Decentralized Exchange (DEX) liquidity pool from the market.

Rubbing one’s nose in one’s work is a common occurrence in the DeFi ecosystem. This is especially true on decentralized exchanges (DEXs) such as Sushiswap and Uniswap, where defrauding token creators can create and list their coins for free without their work being thoroughly inspected and scrutinized.

Featured image from TheStreet, chart from TradingView.com