The Anti-Fraud Center of Henan Provincial Public Security Department recently issued a professional guide exposing prevalent scams in digital currency investments. Here's what you need to know to protect your assets:
4 Common Digital Currency Scams
1. Arbitrage Scams ("Brick Moving")
- How it works: Scammers lure victims into "arbitrage profit" Telegram/WeChat groups using fake stablecoins (e.g., TUSD).
- Secondary attack: After theft, impersonators pose as wallet customer service to steal private keys via phishing sites.
2. Fake Wallet Apps
- Mimic legitimate platforms with malicious code
- Often request unnecessary permissions
- May centrally store users' private keys
3. Impersonated Officials
- Fraudsters pose as exchange/wallet support staff
- Direct victims to phishing sites or demand private keys
4. Ponzi Schemes
- Promise unrealistic returns
- Use pyramid referral structures
- Collapse when new investments stop
6 Investment Forbidden Zones
🚫 Zone 1: Ponzi Coins
Red flags:
- Anonymous development teams
- No public code repository
- Only tradable on proprietary platforms
- Censorship in community chats
Example: Wuxing Coin (collapsed 2017)
🚫 Zone 2: Social Media Groups
Watch for:
- "Insiders" selling below-market prices
- Paid VIP groups charging 888-10,000 RMB
- Immediate banhammer for complaints
🚫 Zone 3: Unregulated Exchanges
Safer alternatives:
👉 Trusted exchanges like OKX
(Look for transparent audits and regulatory compliance)
🚫 Zone 4: Counterfeit Wallets/Coins
Verification steps:
- Check developer credentials
- Confirm open-source status
- Search for security audits
🚫 Zone 5: Phishing Sites
Identification tips:
- Examine URL carefully (e.g., "0KX.com" vs "OKX.com")
- Check SSL certificates
- Bookmark official sites
🚫 Zone 6: Proxy Investments
Risks:
- No direct control over funds
- High potential exit scams
(Example: March 2023 700M RMB theft)
Key Protection Strategies
- Verify before transacting
- Use hardware wallets for large holdings
- Enable 2FA on all accounts
- Bookmark legitimate sites
As noted by Henan police: "Stick to major regulated platforms for safer transactions."
FAQ: Digital Currency Safety
Q: How to identify Ponzi schemes?
A: Look for guaranteed returns, unclear revenue sources, and pressure to recruit others.
Q: Are all DeFi projects risky?
A: Not necessarily, but unaudited smart contracts have higher vulnerability. Always check audit reports.
Q: What if I've already been scammed?
A: Contact platform support immediately and file a police report. Recovery chances improve with quick action.
Q: Why do scammers target crypto?
A: Pseudonymous transactions make tracking difficult, though blockchain analysis is improving.
Q: How to securely store digital assets?
A: Use a combination of cold wallets (offline storage) and insured custodial solutions.
Q: Are mining investments safe?
A: Physical mining operations differ from cloud mining contracts. The latter often have higher fraud risks.
Remember: 👉 Secure your assets with trusted platforms for peace of mind in volatile markets.