Never trust any unsolicited messages that come from unknown individuals; chances are they may be attempting to initiate a “pig butchering” scam. These scams, named after the practice of feeding a pig before slaughter, typically involve fraudsters reaching out to individuals without prior contact and gradually gaining their trust. They may eventually convince the victims to invest in shady investments and then disappear with their money.
Let’s learn about this Crypto scam and how you can avoid becoming a victim of the pig butchering scam.
About pig butchering scam in Crypto
A pig butchering scam in Crypto is a type of investment fraud where fraudsters target unsuspecting individuals with promises of high returns on their investments. The scam is named after the practice of feeding a pig to increase its weight before slaughter, as it involves fraudsters building trust with investors before stealing their hard-earned money.
In a typical pig butchering scam, the fraudster reaches out to potential victims through social media, email, or other online platforms, often using fake identities. They may claim to be Crypto experts or traders and offer investment opportunities that promise high returns with little to no risk.
To build credibility, the fraudster may initially request small investments from the victim, which they then use to provide fake reports and dashboard updates that show significant growth in the investment. This is purely intended to encourage the victim to invest more amount of money.
Once the fraudster has gained the victim’s trust and convinced them to invest a larger amount, they will disappear with the funds all of a sudden, leaving the victim with empty pockets. In some cases, the fraudster may also request personal information or access to the victim’s Crypto accounts, which can lead to major losses.
How can you avoid becoming a victim?
Watch out for these red flags and know how to defend yourself to avoid falling victim to a pig butchering scam:
- Unexpected contact: Never reply to unwanted messages from people you don’t know, even when they’re discussing things that appear simple. This goes double for text messages and encrypted messaging platforms.
- Refusal to engage in video chats: If a person you’ve been contacting frequently refuses to communicate in person or on video calls, they are probably not who they claim to be in their profile photo.
- Request for financial data: Never disclose any private financial information to anyone you haven’t met in person. Put a stop to the relationship if a new online buddy or romantic partner starts asking about your personal finances.
- Request for investment in particular financial products: Any unsolicited investment advice or tips should be avoided, especially if they come from someone you have only spoken to online or if they advise you to trade using your own account. Carefully consider what an advisor would benefit from providing you with free investment tips and whether the deal lines up with your financial objectives and investment strategy.
- Trading platforms that sound unfamiliar: Before transferring any money, do thorough research, especially in a new industry like crypto, where there are hundreds of exchanges and new trading opportunities are constantly developing. Try to find out answers to the following questions – The platform is managed by who? What safety precautions are in place? How can you, if necessary, withdraw money? Don’t place your assets there if you don’t know the answers to those questions.
- Amplified claims and intensified emotions: Any investment that promises considerably larger returns than usual or is marketed as “guaranteed” requires additional investigation. Fraudsters will frequently appeal to your emotions by using what they know about you, such as by asking, “Don’t you want to have money to send your kids to college?”
- Creating a feeling of urgency regarding an upcoming news announcement or share price hike: Always keep in mind that insider trading is prohibited, and you should never buy or sell Crypto or other trading assets in a company based solely on material, nonpublic knowledge.
Pig butchering scams in the Crypto space can impact anyone. Victims aren’t merely vulnerable or aged; they can be young, tech-savvy professionals, such as lawyers, doctors, and police officers, who fall victim to this sneaky ruse.
To avoid becoming a victim of such insidious scams, follow the above-mentioned warnings and invest carefully.Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.