In Australia, cryptocurrency trading is currently the most popular investment fraud.
“Cryptocurrency trading scams have expanded dramatically in the last 12 months and are now the second most popular form of investment scam offer placed on victims,” Scamwatch, an Australian Competition and Consumer Commission (ACCC) consumer service, reported on its website this morning. Cryptocurrency frauds, according to ACCC chair Delia Rickard, are comparable to previous investment scams. “The fraudster will claim to have inside information on market changes that they will exploit to earn you a fortune.” “If you invest, your money will go rapidly,” she said. According to the Commission, more than $26 million has been wasted in the nation this year due to investment frauds. At this rate, the total worth of frauds this year will likely exceed $100 million. (For further information, see How To Identify Cryptocurrency And ICO Scams.)
The mainstreaming of cryptocurrencies has coincided with an upsurge in cryptocurrency-related frauds. The most typical vehicle for illegal activity is an initial coin offering (ICO), or a sale of tokens representing stock in a firm or product. According to earlier this year’s statistics, 80% of ICOs are frauds. (See also: 80% of Initial Coin Offerings are Scams.)
An Early Mover In Cryptocurrency Regulation
To be sure, Australia has acted rapidly to assess cryptocurrencies and implement regulations to limit their harmful impact on the financial environment. In October 2017, it issued ICO rules. AUSTRAC, the country’s financial regulatory body, passed regulations earlier this year requiring digital currency exchanges to register with it. It also requires bitcoin exchanges to comply with AML/CTF compliance and reporting standards. In Australia, there are already three government-certified cryptocurrency exchanges in operation. As of this writing, the Australian dollar is the 15th most-traded fiat currency in cryptocurrency markets. According to the same source, it contributes for 0.04% of total bitcoin trade volume.
Investing in cryptocurrencies and Initial Coin Offerings (“ICOs”) is very dangerous and speculative, and this article is not a suggestion by Investopedia or the writer to do so. Because every person’s circumstance is different, a knowledgeable specialist should always be contacted before making any financial choices. Investopedia makes no guarantees or warranties about the accuracy or timeliness of the information provided on this site.
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