The Federal Bureau of Investigation (FBI) has warned crypto investors a few scam using an investment strategy referred to as liquidity mining. “This scam has been to blame for over $70 million in combined victim losses,” said the enforcement agency.
FBI Warns of Crypto Liquidity Mining Scam
The Federal Bureau of Investigation (FBI) issued an investor alert Thursday warning crypto homeowners of a scam targeting them. The law enforcement agency announced:
The FBI is issuing this public service announcement to warn American citizens about a cryptocurrency scam using an investment strategy called Liquidity Mining in which scammers exploit owners of cryptocurrency, typically tether (USDT) and/or ethereum (ETH).
“Liquidity mining is an investment strategy wont to earn passive financial gain with cryptocurrency,” the FBI explained. “In legitimate liquidity mining operations, investors stake their cryptocurrency during a liquidity pool to produce traders with the liquidity necessary to conduct transactions. In return, the capitalist receives a little of the commerce fees.”
Claiming to use this investment strategy, “Scammers persuade victims to link their cryptocurrency wallets to fraudulent liquidity mining applications. Scammers then wipe out the victims’ funds while not notification or permission from the victim,” the FBI cautioned.
“Scammers approach potential victims through an unsolicited direct message (DM) on social media, geological dating applications, or messaging services like Facebook, Instagram, Twitter, Linkedin, Whatsapp, etc.,” the announcement adds.
Victims of a liquidity mining scam move cryptocurrency from their wallets to the liquidity mining platform, the law enforcement agency careful. when investing, they usually see the supposed returns on a falsified dashboard. believing their investments to be a hit, they purchase extra cryptocurrency. Scammers ultimately move all hold on cryptocurrency and investments created to a billfold they control.
The FBI noted:
Since January 2019, according to the FBI’s Internet Crime Complaint Center (IC3) and open source, this scam has been responsible for over $70 million in combined victim losses.
( Kevin Helms, Bitcoin.com, 2022 )