What Are the Warning Signs of Fraudulent Platforms and Suspicious Crypto-Asset Service Providers?

A Fictional Story Based on Real Life

Martin came across a post on a small internet forum promoting a “revolutionary investment platform” with irresistible offers of guaranteed returns through crypto-assets. According to the post, several local celebrities and politicians had reportedly used the platform.

Hoping for quick profits, Martin was lured in and decided to invest his savings through the mentioned platform. However, when he tried to withdraw his profits, he found that not only was the platform refusing to send him his funds, but it also demanded an unreasonably high withdrawal fee. Even after paying the fee, Martin never received his money, and the platform’s staff stopped communicating with him entirely.

Fraudulent Platforms in 5 Steps

1. The fraudulent platform publishes promotional content through magazines, websites, or online portals claiming users can earn money by investing in crypto-assets.
2. To gain credibility, the scammers often use the names and images of public figures who supposedly achieved high or guaranteed profits through the platform.
3. These articles or blogs include links that direct potential victims to the platform, where various investment products, services, or packages are offered.
4. Fraudulent platforms don’t just seek money from potential victims; they also collect personal information such as email addresses and phone numbers, which they use to market additional products or services.
5. Once funds are sent to crypto wallet addresses or bank accounts linked to the platform, the chances of recovering them are very low.

Explanation of the Scam

Offering investment products or services based solely on promises and fabricated figures is not a problem limited to crypto-assets. Similar scams also exist in other markets, such as forex or stocks.

These schemes often involve the names of public figures who allegedly used the platform to become extremely wealthy. In reality, the mentioned celebrities typically have no connection whatsoever to the platform.

Nonetheless, scammers in the crypto space continue to attract new investors to their platforms, where they offer investment products allegedly linked to crypto-assets. In most cases, these products have little to do with actual crypto-assets. The term “crypto” is used mainly to exploit current trends and attract inexperienced investors eager for fast returns.

Crypto-assets are also favored by scammers due to the irreversible nature of transactions and the degree of anonymity involved. Once crypto-assets are sent, the transaction usually cannot be reversed, and it’s often unclear who owns the wallet address they were sent to. This is precisely what fraudulent platforms aim for.

Moreover, scammers often call their victims—either to offer new investment products or to inform them that in order to withdraw their funds, they must pay an additional fee. These fees are explained using various fabricated reasons, such as early withdrawal penalties, tax payments, or verification fees to “prove” that the funds are not tied to money laundering.

These fees are usually high—another major red flag. If someone has already invested through such a platform (via crypto or other methods), it is usually too late, and they should not send any further money. Once funds are in the scammer’s hands, they will not return them and will likely continue trying to extract more money from the victim.

NBS Advice

Scammers will always look for ways to extract money from potential victims. Claiming support from celebrities is just one of the many ways they build fake credibility. If you want to avoid falling for fraudulent platforms in the crypto space, ask yourself the following questions before making your first investment:

• Is the platform offering investment products well-known and has it been operating on the market for some time?
• Is the platform promising unusually high returns or guaranteed profits?
• Have any public authorities issued warnings about the platform?
• Is the platform associated with celebrities or well-known individuals who have publicly denied any affiliation?
• What do other users say about their experience with the platform?
• When requesting a withdrawal, does the platform ask you to pay a high “withdrawal fee”?

If you suspect a scam, contact the Slovak Police (Polícia SR).

Last updated on 25 Mar 2025