How much do you know about cryptocurrency? If your answer is “not much,” that’s exactly what crypto scammers want to hear. And that’s exactly who one cryptocurrency company targeted with its false and misleading claims, according to a lawsuit filed by the FTC.
The FTC’s complaint against Celsius Network LLC says the company marketed and sold financial services using YouTube and Twitter to promote marketing videos that were full of false and misleading claims. For example, Celsius claimed its crypto platform was safer and more stable than a bank. (It wasn’t.) And it told people that depositing crypto onto its platform came with a “no risk” promise that they’d earn high interest on their deposits. (A lie.) Even worse, the FTC says the company used people’s crypto deposits without permission to spend, trade, invest, or pay business expenses. When Celsius started running out of money, it blocked people’s account access, preventing them from withdrawing their crypto. Now, Celsius is in bankruptcy, and consumers are unlikely to get all their crypto back.
Here’s how to avoid a cryptocurrency-related scam:
- Don’t trust people who make big promises or guarantees. Only scammers promise “no risk” and guarantee high returns.
- Research the company or cryptocurrency platform. Search online for the company or crypto platform name, plus “review,” “scam,” or “complaint” to see what people say.
- Know that cryptocurrency accounts are not backed by a government like traditional FDIC-backed bank accounts. If something happens to your crypto account or funds, the government may not have an obligation to step in and help get your money back.
- Learn about cryptocurrency and scams. Scammers take advantage of people’s understanding (or not) of cryptocurrency and how it works. Visit ftc.gov/cryptocurrency to learn more.
Using a crypto platform that isn’t living up to its promises or guarantees? Tell the FTC at ReportFraud.ftc.gov.
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