The company stressed that it never contacts users via social media for investment opportunities or payments.
BlackRock issued a stark warning to investors about the rising number of cryptocurrency-related scams using its name and brand on social media.
There has been a spike in investment-related scams, including directing users toward crypto investment-related websites and/or social media platforms such as WhatsApp or Telegram. We urge caution in dealing with individuals, websites or social media platforms using our brand and…
— BlackRock (@BlackRock) July 28, 2024
In an announcement made on July 29, BlackRock cautioned investors against engaging with individuals or entities posing as representatives of the company, particularly those offering training or investment opportunities.
Social Media Impersonation on the Rise
BlackRock has stressed that it never contacts individuals through social media platforms. The firm highlighted that scammers are increasingly targeting investors in Bitcoin and Ethereum spot ETFs, using platforms such as WhatsApp and Telegram to lure victims. The scammers often direct users to fraudulent investment websites, claiming to represent BlackRock.
“We urge caution in dealing with individuals, websites, or social media platforms using our brand and offering training or investments,” the company stated.
Legal Actions Against Fake Domains
Last year, BlackRock took legal action against the owners of several fake domains impersonating the company. These bogus websites were designed to defraud investors, with some specifically related to cryptocurrency investments.
One notable incident involved a fraudulent filing for an XRP exchange-traded fund (ETF) called “BlackRock iShares XRP Trust,” which temporarily drove up the price of XRP. BlackRock had to issue a public statement clarifying that the filing was fake.
The rise in scams comes as BlackRock’s Bitcoin and Ethereum ETFs gain significant traction in the market. In January, BlackRock launched its highly successful Bitcoin ETF, and earlier this month, its Ethereum ETF went live, outperforming competing products. The success of these ETFs has made their investors prime targets for scammers.
Industry-Wide Scams and Hacks
The rise in scams targeting BlackRock investors is part of a broader trend in the cryptocurrency industry.
According to Web3 bug bounty platform Immunefi, the industry lost an estimated $509 million to hacks and fraud in the second quarter of 2024, a 91% increase from the same period last year. May 2024 alone saw losses amounting to $107 million, the highest monthly total recorded.
Centralized crypto institutions were the primary targets, accounting for two-thirds of successful attacks. Ethereum was the most exploited blockchain during the quarter, followed by the BNB chain and Arbitrum. These findings underscore the need for heightened security and awareness among cryptocurrency investors.
Despite the rise in scams, BlackRock continues to attract significant investment in its cryptocurrency products. The iShares Bitcoin Trust (IBIT) has brought in $19.7 billion in Bitcoin since its launch on January 11.
This makes it the leading Bitcoin ETF in terms of total inflows, surpassing the combined assets under management of all nine other U.S.-approved spot Bitcoin ETF providers..
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