Scams in cryptocurrency are commontale as more and more people search for opportunities in the market. Whether it is finding the next 100x gem or airdrops, more and more scams in the guise of a click of a button continues to be rampant the more attention cryptocurrency gets. Phishing links and pump-and-dump schemes are common scams to look out for in crypto. Due to its speculative nature, there has to be a certain risk an individual is willing to take to win in crypto. However, there is one scam in cryptocurrency that even non-crypto natives fall for which are guaranteed returns. In this article, we will see why people continue to fall victim to guaranteed returns.

Easy money has always been the most enticing reason for people to enter into speculative opportunities of wealth. The Philippines ranks 6th in the world for the largest gig economy where people take odd jobs and unorthodox opportunities to make a living. The rapid growth of cryptocurrency and its insane returns has persuaded people to enter into the market for a chance of making it quick and easy. While there are those who take the time to study the basics of trading, there are also those who have been convinced that they can receive a significant return in a short amount of time by bad actors. Here are three different ways that scammers use to bait people into guaranteed return scams:

Ponzi Schemes: Started by Charles Ponzi in the 1920’s, it is an investment scam that pays early investors with money taken from later investors to create an illusion of big profits. The more people are involved with the ponzi, the more people participate and become exit liquidity for earlier investors.

Fake Lending Scheme: Instead of investors, early lenders receive a boosted interest that is taken from later lenders. Victims would initially receive their initial capital and the boosted interest which further incentivizes them to add more capital since they’re deceived into an illusion that it is risk-free. The more the victim feels comfortable about the operation while adding larger and larger capital, the scammer would then suddenly disappear with the funds stolen.

Locked tasks: While some look to earn passive income, some choose to find working opportunities. Scammers would message an unknowing victim to present a high pay, low effort job opportunity. These tasks would start with leaving reviews for businesses or comment under a YouTube video. Once done, victims would then receive a small payout to get their trust and require them to deposit some funds in a fake cryptocurrency exchange to get the next task. As the victim continues to work tasks and leave deposits, it will reach a point where the scammer would provide an impossible task that the victim is unable to complete. Since the deposit required becomes bigger and bigger depending on the task difficulty, the victim will then have to forfeit their deposit as they are unable to withdraw their funds from the fake cryptocurrency exchange.

How does all of these scams relate to cryptocurrency? Transactions with no KYC requirements in a market filled with upside potential makes it more enticing as large returns make it seem feasible. While cryptocurrency trading isn’t suited for everyone, crypto has allowed other ways for people to earn without having to trade or risk into a guaranteed return scheme. As everyone desires to have passive income, risk takers who don’t do their due diligence in their research may be persuaded to hop in a sketchy guaranteed return scheme in a speculative market because of crypto’s famed potential for wealth. Always beware of individuals who promise guaranteed returns with no effort needed as there is no such thing