The fact that Australia faces one of the largest crypto fraud outbreaks is not news anymore. It was reported in April 2019 that the country was facing a staggering 200% spike in cryptocurrency scam cases in 2018, but judging by the news articles and the reports we find nearly every day, the situation has not become any better.
Almost every week, we see Australians either being the victims of crypto fraud or being the perpetrators of said scams. Why is Australia such a “hub” for cryptocurrency crimes? Are there some kinds of digital footprints we can follow and come to a conclusion? Well, judging by the fact that the Aussie police haven’t managed to find one sole cause of these outbreaks, it’s going to be a lot harder for us as third party spectators. Therefore, all we can do is speculate.
First plausible reason
Many Aussie experts are saying that crypto scams have become even more prevalent ever since local wagering companies started to add them to their payment methods. This caused a massive surge of crypto popularity in the country, simply because Aussies absolutely love their wagering games.
This quickly spiraled into a process that led to people using wagering platforms as methods of liquidating their crypto assets or avoiding crypto tax laws.
Here’s how it would mostly go. The investors would deposit their funds on a wagering website through a cold wallet, thus disclosing nothing but their wallet address and the already existing credentials on the website, which very rarely contain a name or anything else. When the funds would arrive on their account, they’d place only a few bets, regardless of whether they’d lose them or not, and then quickly cash out via fiat currencies.
But how did the authorities not see the fiat cashouts? Well, because it was being done through third-party providers as well, such as Skrill and Neteller. Since the investors didn’t have anything in common with banks, it was very hard to actually notice them. Furthermore, since Skrill and Neteller are often used for betting purposes, the providers didn’t see anything suspicious about their users withdrawing large sums of money from wagering platforms.
The reason for the increased number of scams was because of fraudulent companies actings as middlemen for these transactions. Multiple individuals started acting like brokers who would make sure that an investor’s crypto funds would find themselves on a wagering website without too many fees or government interference. But this happened on a much smaller scale. The biggest scale was occupied by unlicensed providers, which basically promoted themselves as liquidity providers. They’d offer Bitcoin games, while promising withdrawals in fiat currencies.
However, the problem was that unaware investors didn’t even realize that the games they were “trying to wager on” didn’t even exist. Yes, they sometimes turned out to be empty texts with no functions, designed to just strip a customer’s crypto wallet.
These schemes are still relevant today, which is why it’s recommended to always know what games have the license to offer Bitcoin wagering. You can click here for Australian Bitcoin casino games and find out the specific providers who have the authority to make them, and the operators that have the license to list them.
However, even though these wagering websites were big contributors to the overall numbers, they can’t come close to the overwhelming effectiveness of social media and investment firm scams.
Social media scams
Crypto social media scams have been noticed pretty much everywhere across the world, but Australian cases strike the most controversy, simply because of the length of time they managed to continue for.
There were two instances of such scams that went “viral”. One case used the faces and “quotes” from famous Australian news anchors and the other used the “recommendations” from a famous Australian actor “Hugh Jackman”.
These schemes are actually quite popular around the world. For some reason, investors feel much safer if they see a familiar face on a promotion, believing that a famous person would not recommend something bad to them.
It’s been proven numerous times in the past and present, that even if the promotion is not fake, the quality or legitimacy is not guaranteed.
Is there a pattern?
Although we’ve discussed only two types of scams in Australia, there’s still a pattern to be seen. The first scam method is oriented on the interests and the desires of the general Australian public.
In fact, some experts have called the wagering website scams genius simply because they’re so simple yet so “effective”. The scammers are able to not only target the desire for entertaining content, but also the desire to avoid any unwanted taxes from the government.
Overall, what we can see here is the methods being used to get people interested, and not the act itself. As long as the promoted material is in demand, the scammers will have access to multiple victims.