According to a statistical research conducted by the Australian Competition and Consumer Commission (ACCC), cryptocurrency trading is the second most common investment scam prevalent in Australia.
A consumer service, an initiative by the organisation Scamwatch, posted on its website, “Cryptocurrency trading scams have grown significantly in the past 12 months and are now the second most common type of investment scam offer pushed on victims.”
Delia Rickard, the chairman of ACCC observed that cryptocurrency scams are no different than the basic investment scams. The criminal will dupe the innocent to believe that he has inside knowledge of the market and will effortlessly squeeze money out of their wallets. “The scammer will claim to have inside knowledge about price movements they will use to make you a fortune. If you invest, your money will quickly disappear,” Rickard added.
The loss borne by the investors in general, owing to these scams, has been estimated at around $26 million. The board also warned that the scams could cost the Australian economy as much as $100 million.
The cryptocurrency market is entering the sphere of traditional financial markets, and it seems as though the traditional commonplace malpractices are making their way into the crypto world. ICO’s, i.e. the Initial Coin Offerings are the major instruments of these crypto hoaxes. 80% of the ICOs have already been reported as scams this year.
Australia, however, has been one of the first countries to lay down regulations pertaining to digital currencies in order to bring down the negative instances plaguing the market. Guidelines for ICOs were launched in October last year.
AUSTRAC, the financial regulatory body of Australia has made it mandatory for all the digital currencies to register themselves with the authority. In addition to that, the currencies are also required to comply with the AML/CTF (Anti Money Laundering/ Counter Terrorism Financing) directions.
Australia has a significant role to play as the country has three government-certified crypto exchanges, and the Australian dollar is the fifteenth most traded fiat. Apart from that, Australia shares 0.04% of the total Bitcoin trading.