08/09/2025

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The term ‘pig butchering’ comes from fraudsters referring to their victims as ‘pigs’ that they gradually ‘fatten up’ by luring them into a fake romance or friendship.

Guide to cryptocurrency scams

from fraudsters referring to their victims as “pigs” that they gradually “fatten up” by luring them into a fake romance or friendship before “butchering” them by convincing them to invest in fake cryptocurrency schemes. The victims are often left with devastating financial losses as well as psychological harm. Interpol, in a bid to avoid stigmatising victims, has moved away from the term in favour of “romance baiting”. Rug pull Rug pulls happen when scammers lure investors to invest in apparently legitimate projects which are actually bogus, said lawyer Jasson Gottlieb of Cohen Morrison. These scams mainly take place in decentralised finance, in the absence of middle men, according to Sonia Rogez, a lawyer at HSF Kramer. Two of the biggest “rug pulls” took place in 2021: a scam in which the token Squidcoin was used to lure watchers of the Netflix series Squid Game before a mass sell-off by its investors resulting in losses of between US$2.5 million and US$3.5 million. The second took place when the creator of a virtual fighting game based on ape-themed NFTs (non-fungible tokens) disappeared with roughly US$2.7 million investors had earmarked for the project. More subtle versions of pull rugs involve the siphoning off of investment funds over a long period by hacking smart contracts – a computer code which should secure and automatise trading without the need for an in-between, Rogez said. Pump and dump Often involving “meme coins”, which are generally purely speculative,

In Europe, the police agency Europol said crypto trading was the main area of investment scams. The main targets in France were 18–34 year olds, according to a report for the French financial watchdog AMF. The AMF pointed to a high concentration of crypto in trading scams since 2023, which it said usually involve social networks directing victims to fake trading platforms. Here is a breakdown of the main cryptocurrency scams schemes. Pig butchering Under this scam, fraudsters disguise themselves as female “influencers” or seductive female crypto traders to mainly target men on social media networks, Margaux Frisque, a lawyer at D&A Partners said. Excited by the prospect of fast profits, the victims fall into the trap without checking the reliability of the sites they are being directed to, losing hundreds or even millions of euros, she said. The term “pig butchering” comes

T HE number of investment scams is mushrooming as the cryptocurrency sector flourishes on both sides of the Atlantic. In the US crypto currencies, the most well known of which are Bitcoin, Ethereum and Tether, accounted for 26% of fraud losses reported by consumers in connection with payments methods in 2024, compared with just 9% in 2020, according to the Federal Trade Commission data. Most of the victims are between 30 and 60, technology keen and are looking to invest, according to the FBI which puts at more than US$400 million (RM1.7 billion) the losses avoided due to an operation it launched in January 2024. o From rug pull to pig butchering, signs to look out for

These scams mainly take place in decentralised finance, in the absence of middlemen.

Dogecoin is a meme coin. – PIC FROM PEXELS

imposing strict rules on banks and traders. In the world of cryptocurrencies, however, the human middle men are usually replaced by blockchain, a decentralised register outside traditional banking networks. Frisque, the lawyer, urges investors in crypto currencies to be on “maximum alert” and “ultra informed, ultra prepared and ultra meticulous, because one is one’s own bank.” - AFP

prices are artificially inflated until insiders dump them in a coordinated manner, leaving investors with heavy losses. Unlike rug pulls, which can only be carried out by a project’s purported developers, pump-and-dump schemes can involve anyone. This practice has long existed in traditional financial markets with so-called penny stocks, but there it has been curtailed by regulators

Rug pulls happen when scammers lure investors to invest in apparently legitimate projects which are actually bogus. – PICS FROM 123RF