Recent data disclosed by TRM Labs indicates that residents in the United Kingdom have been losing an average of £15,000 to crypto scams since October 2022, prompting increased regulatory scrutiny and public awareness initiatives.
The data further reveals that British victims have experienced average losses of less than £15,000 (approximately $20,000) since October 2022, with the highest reported loss exceeding £550,000 (around $706,000). Notably, investment frauds account for 16% of reported cases, followed by phishing scams at 9%. Of significance, TRM Labs highlights that phishing scams predominantly target the Ethereum blockchain, representing over 90% of such incidents.
Additionally, another prevalent form of crypto-related fraud is romance fraud, commonly referred to as “pig butchering” scams, which exploit psychological manipulation to entice victims with promises of substantial investment returns.
TRM Labs’ analysis indicates that once illicit funds are set in motion, they are twice as likely to flow through unlicensed service providers compared to licensed ones. Moreover, despite the prevalence of crypto scams, regulatory interventions and public awareness campaigns appear to be making a positive impact, evidenced by a 16% decrease in global crypto-related fraud from 2022 to 2023.
Similarly, the Financial Conduct Authority, the British financial watchdog, reported a notable slowdown in the growth rate of investment fraud in both fiat and crypto currencies in 2023, with the number of victims increasing by only 4.3%, down from 28% in 2022.