Crypto scams in 2022 that marked the entire industry

2022 has been a roller coaster for the cryptocurrency industry. However, the only problem is that it has been going downhill since January. There have been so many crypto scams in 2022 that it’s hard to look back and not talk about them. From the mighty crash of the one-time 4th largest cryptocurrency project to the fall of the 2nd largest cryptocurrency exchange, we’ve seen it all.

Shocking stats about crypto scams

  1. In 2022, users have lost $4 billion dollars in various cryptographic scams to hackers.
  2. The FTX debacle is estimated to have been scammed $8 billion to $10 billion in user funds.
  3. Countless YouTubers have shilling projects that stolen millions of dollars with their viewers’ money in 2022.
  4. DeFi protocols they were the most vulnerable and wanted by scammers.
  5. bitcoins it is the cryptocurrency of choice for scammers, followed by Tether and Ethereum.

The biggest crypto scams of 2022

Let’s take a look at the top 5 scams that affected the entire industry in 2022.

1) FTP

No matter how long you’ve been in the cryptocurrency industry, there’s a high chance you’ve heard of FTX. The collapse of the second largest cryptocurrency exchange has charred the entire industry and resulted in the loss of billions of dollars in user funds.

Crypto scams in 2022

Sam Bankman-Fried

The perpetrator of the scam is the popular and down-to-earth founder Sam Bankman Fried, who now has 8 criminal charges against him. He has been charged with multiple fraud charges which, if proven right, will land him in prison for 115 years.

SBF is now on bail for the largest bail ever offered by the court at $250 million. He is due to appear in court soon and is expected to sign a plea deal. However, lawyers and experts on the subject expect that the terms of the deal would not be favorable to him.

2) Moon and FSO

Do you still remember Luna and FSO? The projects have destroyed an estimated $20 billion to $30 billion in user wealth. They are still considered one of the biggest cryptoflops of all time, and some data even suggests that all of this may have been orchestrated. Indeed, the founder of the project, Do Kwon, is said to be on the run from the police.

Crypto scams in 2022

Image source: NuWire investor

UST was an algorithmic stablecoin backed by Luna. Then, when UST lost its peg to the dollar, people started buying UST and converting it into Luna, which increased the supply of the token to trillions and reduced its value to almost zero. Prior to the crash, Binance had approximately $1.6 billion worth of Luna holdings, which dwindled to just $3000 after the crash.

Subsequently, Do Kwon launched Luna 2.0, but it was not a success that marked the end of this project.

3) Axie Infinity’s Ronin Network

The biggest hack ever performed in the crypto space was done by the Axie Infinity’s Ronin network. We can easily call it one of the biggest crypto scams in 2022. The hackers were able to steal $625 million after discovering a vulnerability in the network and getting 170k Ethereum and 25 million USDC tokens.

Axie Infinity's Ronin Network Loses $625 Million to Hacker

This was such a bad attack that Axie shut down the Ronin Network to prevent further damage. Users could not make any network transactions at that time. One positive news was that Axie informed that the hackers still have their funds in their wallet and are working with law officials to recover them.

Binance and FTX also stepped up to help Axie and said they would provide assistance and help in the investigation of the hack.

4) Safe Moon

Safemoon was first launched in 2021, but its downfall happened in 2022, so we count it among the biggest crypto scams this year. The fraud was exposed by cofeezilla, after which the token dropped 26% in one day. He informed his viewers how the founder of the project, John Karony, was stealing from the liquidity pool. Several other project team members were also doing exactly the same thing.

John also invested in a shitcoin called Stonsk using money from the liquidity pool. There are many other coins and NFTs that the CEO has invested in using user funds. He has also been found raking in millions in Coinbase and Kraken wallets.

Watch the video to get the perfect picture of Safemoon. Many Safemoon fans may disagree with this but this video is a warm take on the project and I agree.

5) Wormhole crypto bridge

Wormhole, the Ethereum and Solana token bridge, lost $321 million in a hack in February 2022. At the time, it was the biggest hack of 2022 with 120,000 wETH tokens lost. The project even offered the hackers a $10 million bounty to return the stolen funds.

Ethereum and Solana bridging tokens, Wormhole loses $321 million in hack

This hack occurred because there was a major vulnerability on the smart contract which was reported by Certik. After the hackers failed to return the funds, Jump crypto reverted the funds to ensure wETH remained pegged 1:1.

What are your thoughts on the biggest crypto scams in 2022? And do you think 2023 will be a better year for the sector? Let us know in the comments below. And, if you found our content informative, share it with your family and friends.

Read also: Sam Bankman-Fried is unlikely to get a good plea deal, informs the lawyer.

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