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SEC Issues Urgent Crypto Scam Warning

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Wed, 29/05/2024 - 20:01
SEC Issues Urgent Crypto Scam Warning
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The U.S. Securities and Exchange Commission (SEC) has published an investor alert about cryptocurrencies. 

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The SEC has stated that fraudsters tend to leverage innovative investment technologies in order to perpetuate investment scams. 

Fraudsters particularly aim to exploit the hype surrounding artificial intelligence (AI) technologies in order to attract potential victims. Fraudsters might use attractive buzzwords in order to promote their scams. 

Moreover, these bad actors might also rely on cutting-edge AI tech in order to fake their identity. The rapid growth of AI has made it much easier for fraudsters to impersonate government agencies as well as prominent individuals (such as Ripple CEO Brad Garlinghouse).    

The SEC has also warned about fraudsters contacting potential victims via social media in order to establish an online relationship and promote investment scams. Hence, users are strongly advised against making investment decisions solely based on some internet advice. Of course, one should also never share his or her sensitive financial information with strangers on the internet. 

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In addition, the SEC has also warned about pump-and-dump schemes that involve digital assets. 

The alert comes amid the growing popularity of meme coins, with numerous celebrities embracing the latest crypto craze by launching their own tokens.  

It is worth noting that some recent celebrity coins have been accused of being scams. 

The SEC specifically mentioned meme coins in its investor alert, stating that their promoters frequently aim to artificially pump the price of a certain coin in order to capitalize on the hype. 

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