Crypto Heist: 2021’s Biggest Cryptocurrency Scams

The year 2021 was a watershed moment in the mainstreaming of cryptocurrency. It was also a big year for crypto fraud.

Popular cryptocurrencies such as Bitcoin, Ethereum, and Dogecoin had a successful year, which began with the January memestock craze. These cryptocurrencies soared to new highs, attracting the attention of people who were previously unfamiliar with the industry.

However, cryptocurrency is unpredictable. It’s still an extremely volatile market, with almost no regulations protecting those who, say, invest in the stock market. With so many crypto newcomers flocking to this lawless wild west in the last year, scammers have salivated at the newfound opportunities to profit at their expense.

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Scammers are still using Twitter to mislead new crypto investors into believing Elon Musk wants to double their investments. But that’s a 2020 scam. Some of those schemes look like child’s play in 2021.

We’ve combed through some of the year’s biggest scams to round out the year. We’re not just talking about the amount of money stolen. This list also includes the most outlandish and audacious scams.

1. Squid Game Token
What do you get when you combine the year’s biggest streaming television hit with a cryptocurrency?

One of the year’s most widely publicized scams.

Embarrassingly, media outlets fell in love with Squid Game token, a completely unauthorized alternative cryptocurrency based on the hit Netflix series Squid Game.

In just a few weeks, a Squid Game token went from being worth a few dollars to nearly $3,000. CNBC, Forbes, Business Insider, and a slew of other outlets all covered the Squid Game token, seemingly enamored with how quickly its value was rising.

However, there were issues from the start. Aside from the fact that its creators had no authority to use the Squid Game name to base their cryptocurrency on, people who invested in the Squid Game token immediately complained that they couldn’t sell what they bought.

Of course, this was on purpose. Squid Game token’s creators built an anti-sell-off mechanism right into their cryptocurrency. Of course, not everyone was barred from selling. And Squid Game token ended up like the majority of these altcoins: a pump and dump scheme that enriched its creators and their friends while leaving well-meaning retail investors out of pocket.

However, the amount of press coverage Squid Game token was able to generate before the scam was revealed, which likely helped bring in more dupes, was truly unique.

2. The SaveTheKids/FaZe saga
In 2021, social media influencers made a lot of money by promoting cryptocurrencies.

Of course, a large portion of the cryptocurrency promoted by your favorite Instagram or TikTok celebrity ended up being pump and dump schemes. However, no other example of an influencer-hyped cryptocurrency swindle can compare to what happened with the SaveTheKids token.

FaZe Clan members Kay, Teeqo, Jarvis, and Nikan, along with YouTuber RiceGum, began promoting a charity-based cryptocurrency called SaveTheKids in early June 2021. These influencers did not simply send out a few tweets that took a few seconds to type. They made promotional videos and donated photos to the SaveTheKids website.

The sales pitch was straightforward: invest in this new cryptocurrency that is sure to succeed due to its ties to the world’s largest Esports brand, and the project will also help raise funds for children’s charities. A win-win!

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Except that the entire thing was a rug pull. This happens when a developer creates a cryptocurrency with the intent of stealing money from investors. Shortly after the official launch of the SaveTheKids token, the crypto tanked due to a massive sell-off by the initial investors who held the majority of the tokens. As soon as SaveTheKids went public, it lost all value.

Perhaps the situation could have ended there, with the whole thing labeled as yet another alternative coin scam. However, some noticed that FaZe Kay, in particular, had a penchant for promoting cryptocurrencies that all ended in this manner.

YouTubers such as Coffeezilla, SomeOrdinaryGamers, and Barely Sociable quickly unearthed a tangled web of deception that implicated FaZe Kay not only in promoting the scam, but also in its creation.
By the end of this saga, FaZe Clan had launched an internal review, which resulted in multiple suspensions and the expulsion of FaZe members, including FaZe Kay.

3. Adin Ross admits to promoting a cryptocurrency scam.
It would be remiss not to acknowledge Adin Ross’ promotion of the MILF token.

Ross is a well-known Twitch streamer with millions of followers. He’s been chastised in the past year for his gambling streams, in which he promoted shady online casino platforms. Over the summer, the streamer accidentally leaked his messages in a stream, revealing that he’s making millions from these promotional deals.

However, in May 2021, Ross entered the cryptocurrency world by promoting an alternative coin known as MILF token. Ross was paid hundreds of thousands of dollars to stream himself going through the arduous process of purchasing cryptocurrency.

However, just three weeks later, Ross’s messaging on this investment opportunity had shifted dramatically.

“By the way, remember that MILF Token nonsense I did a while back? I’ve already told you not to buy that nonsense “During a livestream, Ross burst out laughing. “I got paid a lot of money to do that shit. I mean, I don’t give a f*ck. I’m hoping none of you actually bought it.”

At the time of publication, the MILF token had lost nearly 98 percent of its value since Ross promoted it.

4. phony press releases
Last year, it was impossible to come across a tweet about cryptocurrency without encountering a Fake. Elon Musk’s Twitter account appears in the replies, promoting a new memecoin or ponzi scheme.

Fake press releases have taken this scam to new heights this year.

In 2021, fake press releases from global retail corporations duped the media into publishing false stories about companies accepting cryptocurrency on two separate occasions. A fake press release announced in September that Walmart would begin accepting Litecoin. Only a few months later, a phony press release claimed that Kroger would accept Bitcoin Cash as payment.

The mainstream media fell for the ruse and reported on the fake news in the press release as if it were true. Screenshot courtesy of Mashable
Neither was correct. However, the fraudsters behind these sham documents were able to successfully distribute this fake news via large press release distribution companies, where it was disseminated to and covered by mainstream news outlets.

In both cases, Litecoin and Bitcoin Cash prices rose in response to the news, only to fall again after Walmart and Kroger denied the claims. As a result, anyone involved in the scam will make a quick buck.

As cryptocurrency supporters seek validation and legitimacy for their fledgling industry, scams claiming to provide it will proliferate.

5. Poly Network Infiltration
This would have been the heist of the century, not 2021.

During the summer, a hacker discovered a flaw in the decentralized finance platform Poly Network, allowing them to transfer over $600 million to their account.

Approximately $600 million.

However, a haul that large would have been difficult to get away with scot-free. In the weeks that followed, the hacker contacted Poly Network and stated that it had always been their intention to return the money. Poly Network went along with it, even referring to the hacker as “Mr. White Hat,” a reference to the term describing an ethical hacker who attempts to expose security flaws so they can be fixed before a malicious actor arrives.

It all worked out in the end for Poly Network. The majority of the cryptocurrency funds were eventually transferred back to the platform by the hacker.

What did the hacker gain from it? For one thing, they avoided any potential consequences for carrying out the largest crypto heist in history. Poly Network also offered the hacker a $500,000 reward for returning the funds.

6. Africrypt fraud
Raees and Ameer Cajee, two brothers from South Africa, ran Africrypt, a Bitcoin investment firm. They are now missing, as are all of their investors’ cryptocurrency.

The Cajees claimed in April 2021 that their investment firm had been hacked and that all of their clients’ accounts had been compromised. The story, however, was quickly dissected, and investors pointed fingers at the Cajees.

Lawyers representing investors claim that the Cajee brothers stole up to $3.6 billion. If that were true, Africrypt would be the largest crypto heist by far, surpassing Poly Network.

However, that figure is debatable. Still, we’re talking about millions and millions of dollars here.

Africrypt investors are still working to recoup their investments. Raees and Ameer Cajee’s current location is unknown.

7. Theft of Bored Ape NFTs
Calvin Becerra’s story pales in comparison to the sums of money stolen in the other scams on this list.

It is, however, worth mentioning.

Becerra owns three NFTs from the Bored Ape Yacht Club. Investors purchase these non-fungible tokens in order to demonstrate ownership of the item to which they are linked. In the case of Becerra, we’re talking about three pieces of computer-generated art depicting cartoonish apes.

Scammers, according to Beccera, duped him into sending these three NFTs under the guise of providing technical support.

What is the current NFT market floor price for one of these apes? Approximately $225,000

Becerra claims the three Bored Ape NFTs he owned were worth more than a million dollars.

Becerra appears to have recouped at least some of his NFTs, though he appears to have had to pay to do so. When they were first stolen, Becerra attempted to spread the word and warn others not to buy his stolen NFTs.

Despite the fact that the blockchain proved he no longer owned them, Becerra claimed that the irrefutable records on the blockchain were irrelevant and that he was the true owner. Essentially, he argued against the very foundation that NFT proponents claim provides any of this value.

Perhaps these stolen NFTs are the biggest scam of the year after all.

 

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