FBI report reveals rising crypto scams in 2024, with investment fraud losses hitting $5.8 billion

The Federal Bureau of Investigation (FBI) has released a stark warning about the rise of cryptocurrency-related fraud, revealing that investment scams alone accounted for $5.8 billion in losses in 2024. This figure represents more than half of all reported crypto losses last year, underlining the growing threat posed by cybercriminals in the digital currency space.

According to data from the FBI’s Internet Crime Complaint Centre (IC3), the total losses from internet crimes in 2024 reached $16.6 billion, a 33% increase from the previous year. Of this, cryptocurrency-related scams contributed a staggering $9.3 billion, marking a 66% year-over-year rise. The FBI’s comprehensive 47-page report highlighted the central role that cryptocurrency plays in modern cybercrime, with nearly 150,000 complaints related to fraudulent crypto activities.

Among the various schemes contributing to these alarming statistics, investment scams were the most damaging. These scams typically involve fraudulent crypto platforms that deceive victims into investing vast sums. A major portion of these scams was identified as “pig butchering,” where cybercriminals establish fake online relationships with targets, often manipulating them into making substantial crypto investments in fake platforms that promise high returns.

The FBI report also drew attention to the disproportionate impact these scams are having on elderly Americans. Individuals aged 60 and above reported over $2.8 billion in losses, making them the most targeted demographic. This troubling trend underscores the vulnerability of older individuals to sophisticated fraud schemes, with scammers exploiting emotional manipulation and trust to further their gains.

In response to the surge in crypto-related fraud, the FBI launched Operation Level Up in early 2024. The operation identified over 4,300 victims of crypto scams, with a shocking 76% of them unaware that they had been victimised. This statistic highlights the evolving and increasingly sophisticated methods used by cybercriminals, who have perfected techniques to deceive even the most cautious investors.

Blockchain forensics firm TRM Labs also expressed concern about the growing prevalence of crypto scams. Their research suggests that at least $10.7 billion in crypto funds were funneled into fraudulent schemes in 2024, with new phishing and investment scam websites emerging on a monthly basis. The firm has warned that scammers are becoming more innovative, exploiting QR codes, crypto ATMS, and stablecoins like Tether’s USDT and decentralised stablecoin DAI to defraud unsuspecting users.

One of the most concerning developments has been the rise of AI-generated personas used by fraudsters to impersonate financial advisors or acquaintances online. These fake identities can appear highly convincing, leading many victims to trust scammers with large amounts of cryptocurrency. As cryptocurrency adoption continues to grow, the risk of encountering such fraud schemes increases, making it essential for investors to exercise extreme caution.

The FBI and cybersecurity experts continue to urge cryptocurrency users to remain vigilant. They recommend verifying the legitimacy of platforms before investing and being wary of unsolicited messages, whether from social media or email. The FBI also advises investors to be sceptical of any claims promising unusually high returns and to always conduct thorough research before engaging in financial transactions in the crypto space.

As cryptocurrency becomes an increasingly integral part of the global financial system, the battle against fraud is expected to intensify. Law enforcement agencies and cybersecurity firms are working tirelessly to combat these criminal activities, but the onus remains on individual investors to protect themselves from falling victim to fraud.