Crypto Fraud Losses Jump 45% to $5.6 Billion in 2023

According to the FBI, crypto fraud cases surged by 45% last year, with losses totaling $5.6 billion.

This increase came as cryptocurrencies regained traction after the market decline in 2022. The FBI’s Internet Crime Complaint Center received nearly 69,500 reports of crypto fraud, which accounted for nearly half of all financial fraud losses in 2023.

The FBI’s report reveals that investment scams were the most common type of crypto fraud, responsible for about 71% of reported losses. These scams often deceive victims with promises of high returns from volatile crypto investments. Other significant fraud types included call center scams, where fraudsters pose as government officials to extract cryptocurrency.

Geographically, California, Florida, and Texas had the highest number of reported cases, with elderly individuals being particularly targeted. The FBI advised investors to be cautious and skeptical of offers that seem too good to be true.

Additionally, the FBI recently warned against using cryptocurrency transfer services not registered with the Financial Crimes Enforcement Network (FinCEN). The rise in fraud has not only shaken consumer confidence but also prompted increased regulatory attention. The FBI also cautioned crypto firms about potential attacks from North Korean hackers, highlighting ongoing security challenges.