In this unregulated space, crypto investors must be vigilant.
Many investors are wary of cryptocurrencies because they are still unfamiliar and, as yet, largely unregulated. Although bad actors and scams may ding the reputation of the entire ecosystem, as far as the overall crypto industry is concerned, there are also “a lot of good projects and good people” working on digital asset products, says Merav Ozair, blockchain expert and fintech professor at Rutgers Business School. However, “the nature of being decentralized means that a bank, regulator, or law enforcement agency has no control over the network or crypto assets,” says Jonathan Wykes, managing director at crypto exchange CEX.io, who adds that “unless your crypto was scammed by another user on a centralized exchange, getting stolen crypto back is nearly impossible.” In a new, relatively opaque space where there’s a lot of money to be made, it’s hard even for savvy investors to navigate risks, says Alma Angotti, partner in financial services at management consulting firm Guidehouse. Here are five crypto scams investors should watch out for in 2022.