Cryptocurrencies: Scams and Preventions

Abstract

This research paper aims to introduce cryptocurrency, discuss its running process and investment value, as well as analyze fraud cases and prevention measures for cryptocurrency scams. The article's structural framework, represented by Fig. 1, is presented for reference. Along with the rapid development of cryptocurrency, an increasing number of individuals are attracted to its investment value or the great profits that can be obtained in a short time. However, with its special features, such as decentralized management and irreversible exchange, cruel scams arise. Many people do not realize the ingeniousness and seriousness of fraud, and these preventive measures are not widely promoted, so people are easily deceived and become the target group of fraud gangs. Serious scams result in decreasing the reputation and credibility of cryptocurrency because they occur in a variety of situations and use various methods, causing the wealth accumulated for a long time to be wiped out in an instant. Nevertheless, with an overall understanding of the basic knowledge and running process of cryptocurrency and some awareness of common scams, the probability of such fraud incidents can be well reduced. This research paper combines the knowledge to enhance the awareness of cryptocurrency investors to prevent fraud, which is both beneficial to cryptocurrency development and people’s investment experience.