04/02/2026

Fraudsters use crypto hype to scam investors out of more than £500,000 a day

Cryptoassets are not regulated financial products so please be aware that trading them carries a considerable amount of risk for your capital. Cryptocurrencies are also not covered by existing consumer protection laws and are not suitable for the majority of investors.

Cryptocurrency has become a common investment for people in recent years. Indeed, more people are choosing to invest in digital currencies such as Bitcoin and Ethereum.

The Financial Conduct Authority (16 December 2025) reports that roughly 8% of the UK’s population were cryptoasset owners in 2025.

However, with this rise in crypto interest comes more risk. Scammers have been developing increasingly sophisticated ways to exploit a lack of familiarity with how cryptocurrencies work.

According to the Guardian (24 October 2025), the amount lost to investment scams in the UK increased by 55% in 2025, with fake cryptocurrency schemes topping the list. Worryingly, losses to investment scams reached £97.7 million during the first six months of 2025 – more than £500,000 each day.

It’s vital to remember that cryptocurrencies are risky and tend to be volatile, meaning they aren’t suitable for everyone. Still, if you’re considering investing in cryptocurrency, understanding the difference between a scam and a real opportunity could protect your wealth.

Here are six of the most common ways fraudsters might take advantage of the hype around crypto and attempt to lure you in.

1. Enticing you with social media adverts and fake endorsements

Social media has become one of the main tools fraudsters will use to commit cryptocurrency crimes.

Scammers will often use professional-looking adverts on platforms such as Instagram or YouTube to promote investment opportunities.

Some adverts feature fake celebrity endorsements, or even “deepfakes” – which are AI-generated videos that impersonate real people – to show well-known figures supporting a cryptocurrency.

These clips are usually very convincing, and even experienced crypto investors can be fooled.

In reality, the celebrities in the videos often have absolutely no involvement in any investment opportunities related to the currency. Regardless, these deepfakes often succeed in instilling trust and getting social media users to hand over personal details.

Fraudsters also use social media adverts to entice their victims. With them, they often downplay the risks or make it seem like everyone is investing in crypto.

2. Building confidence with small early “profits”

Scammers will also attempt to persuade you to make smaller initial investments to draw you in.

Scammers won’t always ask you for a large investment straight away. Instead, they could attempt to gain your trust by suggesting smaller investments to begin with.

Yet, once you’ve done so, they will then try to show that you’ve already turned a “profit”.

Of course, watching your investments rise in value can make any scam seem authentic. You may even decide to contribute more to the scam.

Then, when you attempt to withdraw funds, scammers might discourage you by imposing additional fees. Or, in the worst-case scenario, disappear altogether with your money.

3. Creating a false sense of urgency

Many scams, including those involving cryptocurrency, rely on pressuring you to act quickly.

You may be told that an opportunity will be available for only a short period, or that the market is about to rise significantly. This could prompt you to act now to secure any returns.

However, these pressure tactics are designed to prevent you from stopping, thinking, or even seeking professional advice.

You should remember that genuine investments typically don’t require instant decisions, and being rushed is usually a red flag that you’re walking into a scam.

4. Using overly complex explanations

It’s worth noting that cryptocurrency is new, highly technical, and often unfamiliar to even the most experienced investor. Unfortunately, scammers can use this to their advantage.

Scammers may use confusing jargon, complex charts, or technical explanations to discourage you from asking questions, all while creating the impression that they’re experts.

If you don’t fully understand an investment, it’s essential to pause and think. Legitimate providers should always be able to explain how everything works and the risks involved.

5. Being asked to keep an investment a secret

You may find that fraudsters will tell you not to discuss any investment opportunities with your friends, family, or advisers.

They may even warn you that sharing any details could affect your returns, or that other people won’t understand the opportunity.

This makes it far easier for scammers to manipulate any future decisions you might make, and harder for your support network to raise any concerns.

6. Using fake cryptocurrency wallets or websites

Fraudsters often create fake wallets or websites that might seem like legitimate platforms on the surface.

You could be directed to download an unusual mobile app or visit a website that seems professional.

In reality, these fake platforms can steal your login details, giving scammers access to your financial information.

Then, with this information, the fraudsters could compromise other assets, such as your bank or investment accounts.

Scammers might also offer seemingly legitimate tools you can use for tracking or trading digital currency, only to misappropriate any funds you transfer to them.

As such, it’s important to carefully check any URLs and verify any downloads with the proper provider.

Contact us

It’s always worth speaking to a trusted professional before you make high-risk investment decisions. Please contact us today to find out how we can help.

Please note: This blog is for general information only and does not constitute financial advice, which should be based on your individual circumstances. The information is aimed at retail clients only.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. 

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

Cryptoassets are not regulated financial products so please be aware that trading them carries a considerable amount of risk for your capital. Cryptocurrencies are also not covered by existing consumer protection laws and are not suitable for the majority of investors.