Fake Crypto Scam Raises $100k to Raise Awareness
FatMan Terra, a crypto influencer on Twitter, claims to have gathered over $100,000 worth of Bitcoin from crypto investors in a scheme that was later revealed as fake. Done to send a message, he said too many crypto holders blindly follow investment advice from influencers.
His account, which has around 101,000 followers, was formerly known to tweet in support of Terra. Following the stablecoin’s $40 billion collapse in May, FatMan Terra now frequently speaks out against the project and its founder, Do Kwon.
In a tweet on Monday, he told his followers that he had “received access to a high-yield BTC farm based on a private carry trade operated by an up-and-coming fund.” The post continues that people can direct message him if they want access to the opportunity.
While the post received some criticism, FatMan Terra still claims to have raised over $100,000 in Bitcoin within two hours.
On Tuesday, he revealed that the investment scheme was fake all along — saying it was “far too easy to scam people in crypto.” FatMan Terra called it an “awareness campaign” to show how easy it was to dupe people in crypto:
“While I used plenty of buzzwords and put on a very convincing act on all platforms, I made sure to keep the investment details intentionally obscure — I didn’t name the fund and I didn’t describe the trade — no one knew where the yield was coming from.”
He followed up with, “If you don’t understand where the yield is coming from, you are the yield”
FatMan Terra claims that his fake investment opportunity was inspired by the Lady of Crypto account, which has been implicated of endorsing multiple questionable investment schemes to over 257,000 followers. He also names other influencers, such as BitBoy crypto, who recently came under fire from Atozy for promoting crypto scams.
This has become a pervasive issue in cryptocurrency investing, with multiple sketchy projects resulting in rug-pull scams where crypto investors lose their token to a project that quickly disappears after raising investment.
Celebrity endorsements have become a way for many projects to boost their publicity and overall market capitalization. These endorsements are misconstrued by token holders as potential investment advice, or endorsements of crypto projects, that proceed to drop dramatically in value. Famously, Kim Kardashian promoted EthereumMax, which fell 99% after her endorsement, causing multiple people to lose their entire investment. She was recently sued for her participation with the project, alleging that she colluded with EthereumMax to “misleadingly promote and sell” the token in a pump and dump scheme.
$14 billion has been stolen in cryptocurrency scams since 2021, according to a new report released by Chainalysis. Crypto-related crimes amount to one out of every four dollars reported stolen by fraud, more than any other payment form. Up 79% from a year earlier, scamming is the greatest form of cryptocurrency crime.
There are multiple ways to avoid falling victim of a cryptocurrency scam, as FatMan Terra indicated. Investment details, participant names, and the model of return should all be indicated. Obscurity around these details indicate that the opportunity is probably a scam, as it was for the Squid Coin Scam. Excessive marketing, promising free money, and celebrity endorsements are also good indicators that a project might not be legitimate. It sounds cliché but if it looks too good to be true, then it probably is.
About Centuries Analytics
Investing in cryptocurrency doesn’t have to be risky — not anymore. We let data speak; not investors, “experts”, pundits, or tv show commentators. Centuries uses social media, financial, and macro-economic data to determine and predict cryptocurrency markets.
Find out more: https://www.centuriesanalytics.com/
