Unearthing The Fast-Mushrooming Crypto Scams On WhatsApp

Terabytes have been written about the modus operandi of major crypto scams involving bitconnect, gainbitcoin, onecoin and others. and the latest in this space seems to be whatsapp scams with zero checks and balances. India has literally become a hotbed for crypto frauds thriving on the messaging app, given the surge in the number of users the country has added in the last 18 months and their questionable activities.

In china, a similar modus operandi was popular in 2018 and 2019 when many “crypto” entities migrated to wechat to escape investigative agencies. in india, as of aug 2021 (it is the first whatsapp group with suspicious activities that inc42 can track), hundreds of whatsapp groups have been created by pseudonyms acting as btc (bitcoin) investment analysts and attracting the people guaranteeing 95-100% returns.

Reading: Bitcoin internal discussion group

Since several inc42 members have been added to at least 30+ of these groups, we think it’s time to dig in and find out what these whatsapp groups are doing.

inside the dark world that promises gold

It all started in August of this year. I was added to three whatsapp groups called btc fortune vip16_001, btc get rich vip10_001 and btc get rich vip10. some of my colleagues also joined similar groups, but the final numbers varied. there was no initial conversation about why I was added to a group of unknown people or who ran those groups. permission was not requested either.

After talking to my networks and colleagues, I realized that almost 60% of them were part of such groups, with some joining more than three groups, each with at least 100 members.

These pools all have similar names like btc get rich vipxx, btc fortune vipxx, btc contract vip, etc., with xx being the number that changes each time. and most of these groups are amazingly similar.

“bitcoin contract trading is the fastest growing commodity for wealth. rags to riches, join us and make it happen” – the tirade went on and on.

crypto scams on whatsapp

although 95% of the mobile numbers displayed in these whatsapp groups are from india, some of them, including some numbers belonging to group administrators, are from hong kong, indonesia, the united kingdom and African countries. (Africa sounds familiar to you?) Interestingly, almost all of the help numbers listed by so-called btc investment analysts are just hong kong numbers.

the anatomy of a crypto scam designed to outsmart you

at first glance, it’s as simple as abc. after creating a group and adding hundreds of numbers, a person acting as a btc investment analyst starts with a welcome note and then gets right to the point.

“Here, I will guide you on how to get more money. here is the bitcoin trading group of btuw investment consultants ltd. In the next two days, I will share with you how to increase your wealth through bitcoin, let your wealth grow fast, and make your wealth run. Whether you are a rookie or a veteran, you can carefully look at the group information. because this can really bring you profit.”

shortly after, a small group of four or five people will start talking about btc 101 (basic information like what it is and how to make money) and in a few minutes they will start acting as entertainers.

See also: Apple unveils contactless payments via Tap to Pay on iPhone – Apple

After a short while, the “analyst” cuts to the chase and details how to set up the bitcoin contract reversal.

Here’s a quick look at the step-by-step procedure:

  1. get a cryptocurrency wallet (
  2. set up a wtp exchange account (
  3. choose an investment plan that works for you.

In most of these scam groups, exchange links shared with members include gd-global, also known as btuw, wtp, and coin global for bitcoin contract investments.

interestingly, all these groups on whatsapp ask people to create or promote binance wallets only. after most of the “analyst” investment suggestions, the cheerleaders come forward to confirm 100% returns.

we found one of the pools called btc fortune vip12 that promise returns on jst mining. promising yields vary as shown in the following chat:

crypto scams on whatsapp

kelan, the pool attendant, then told the user to download a token pocket wallet and deposit up to 30,000 usdt (a stable coin equivalent to $1) for mining rewards.

the flow of money

on a daily basis, most of these groups see $400-800 worth of transactions from three to four orders.

To understand the big picture, let’s assume that at least 100 of these groups have been active in the last four months, the average daily transactions amount to $500. this means a monthly total of $500x30x100, or $15 million, raised by all active groups. however, the amount could be much higher as we have kept the daily transaction value at $500.

Furthermore, these transactions are rarely included in the income tax or education scan.

What is worrying about these crypto investment schemes?

People don’t use their names or other details: Nearly all of these groups use similar language, and group members carefully hide their names and other details so no one can google them. and acting investment analysts are always careful not to answer calls to avoid direct communications with legitimate investors.

Missing company details: The company names mentioned in these groups have little or no details and cannot be independently verified by anyone. For example, in groups called BTC Contract VIP 24 and BTC Contract 73, analysts say they are from the UK, Singapore, South Korea, and Hong Kong and work for MPIs Investment Co. limited. but again, they are careful not to provide website details and verifications are not possible. they don’t even share the social media pages of their respective companies.

See also: List of Best Anonymous Bitcoin Casinos & Bonuses 2022 | GEM – Global Extra Money

The curious case of non-compliance: Interestingly, there is no provision for kyc/ekyc and no legally valid contracts between stakeholders are signed prior to investments for Indian agencies to examine the same as and when required. this seriously violates the law of the country and raises questions about operating procedures. In all of these groups, analysts seem to represent foreign companies, such as companies based in the UK or Hong Kong, asking people to invest in platforms that are not based in India or have no presence here.

Consent is missing: Most importantly, many users told inc42 that they had been added to these groups without their consent. The big question here is how unrelated people/groups can access each other’s mobile numbers on such a massive scale.

One of the users who raised several questions during group interactions said on a social Q&A platform quora that the group admin banned him from posting comments. subsequently, the person was removed from the group. in other cases, entire groups are slowly killed/deactivated. then these analysts open another whatsapp group, but are careful not to single out users who post too many worrying questions.

Are we interacting with bots?: The identical language and response patterns in these groups make people wonder if these are mostly bots controlled by a few humans. most of the group attendees are women (by their names). but i was also part of a group called btc contract vip 24, where the assistant was a man. For whatever reason, the analyst kept referring to the assistant as “she” and “her,” raising questions as to whether they were both bots or the only humans running multiple WhatsApp groups.

will these cryptocurrency scams affect the future of currency in india?

Rapidly thriving crypto scams are one of the main reasons why the Indian government and Reserve Bank of India continue to issue numerous notices on crypto investments. it also delayed the cryptocurrency regulatory bill.

speaking at the sydney dialogues in nov. on the 18th of this year, prime minister narendra modi alerted people again.

“Take cryptocurrency or bitcoin, for example. it’s important that all democratic nations work together on this and make sure it doesn’t end up in the wrong hands, which can bankrupt our young people,” he said.

While the government has yet to establish clear rules on cryptocurrencies, the general lack of knowledge about crypto markets and investments has been risky for retail investors who have embraced this new asset class solely to earn high returns in a short time. Record time. therefore, it is essential to ensure that all safeguards are in place to keep one’s money safe. people should check if these platforms have their offices in india, comply with the rules and regulations of the country and maintain transparency.

Of course, just like any other asset class, investing in cryptocurrencies involves market risks, but getting scammed is mostly due to a lack of knowledge and caution.

Think about the gainbitcoin scam that ran rampant during 2015-2018 and managed to attract over 8,000 people by promising quick cash. After the fraud was dismantled, people from all over India and even the United States began filing complaints against the platform’s founder, Amit Bhardwaj, and his associates/agents. bhardwaj was arrested in 2018 (currently out on bail), but investors have yet to recover the money from him.

divyesh darji, the main accused of bitconnect fraud, also took advantage of this knowledge gap, and many people invested there without carefully analyzing the platform. The size of these scams is said to vary between $8.5 billion and $20 billion.

Even when the bitcoin price was $5,000 in 2018, up from $20,000 in November 2017, these would-be scammers could fool over 10,000 people. Now that bitcoin has hit a record high of over $69k, the number of Indian investors has surpassed 15 million, and investments through major cryptocurrency exchanges are hovering around 6 lakh cr, scammers will be working overtime to fool people .

Even in the absence of crypto regulation in India, the country’s investigative agencies should take note of what is happening in certain WhatsApp groups. Until then, caution should be the watchword if you want to take advantage of these digital assets.

See also: Will Bitcoin Ever Switch To Proof-of-Stake? |

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