BlackRock Issues Urgent Warning on Rising Crypto Scams
- BlackRock warns of rising crypto scams targeting its Bitcoin and Ether ETFs.
- Investors are advised to avoid social media interactions with impersonators.
- Scammers use sophisticated tactics, including phishing websites and fake platforms.
Investor Alert: BlackRock Highlights Spike in Crypto Fraud
The famous asset management firm BlackRock has issued a strict alert to investors regarding an increase in crypto scams related to its iShares Bitcoin and Ether ETFs. The New York-based firm is cautioning its clients especially against fake impersonators on social media platforms like WhatsApp and Telegram.
On July 29, BlackRock pointed out an increase in a significant number of fraud cases where individuals or companies posed as representatives of BlackRock. These fraudsters usually lure their victims with the prospects of training or a good investment opportunity.
The warning explicitly states that BlackRock never contacts users via social media to solicit investments or payments, advising investors to be vigilant and avoid interactions with such impersonators.
BlackRock ETFs Ignited Increase In Scams
The uptick in scams has coincided with the launch of BlackRock’s iShares Bitcoin Trust (IBIT), which has amassed $19.7 billion in Bitcoin since its launch on January 11. This ETF has outperformed all other U.S.-approved spot Bitcoin ETFs combined in terms of total inflows. BlackRock’s recent approval of a Spot Ethereum ETF on July 23 has further intensified interest in crypto investments, making the firm a prime target for scammers.
Robert Mitchnick, BlackRock’s head of digital assets, highlighted that their clients are primarily interested in Bitcoin and Ether, with minimal interest in other cryptocurrencies.
He shared these insights at the Bitcoin 2024 conference in Nashville, Tennessee, stating, “Our client base today overwhelmingly shows interest in Bitcoin first, then somewhat in ETH, with very little interest beyond those two.” Mitchnick forecasts that investors might allocate around 20% of their crypto holdings to Ethereum, with the rest to BTC.
CEO Larry Fink has also communicated a change of heart regarding Bitcoin, describing it as "digital gold" and a legitimate financial instrument. He highlighted Bitcoin's potential for providing uncorrelated returns, enhancing its appeal to investors.
BlackRock Alerts Investors to Sophisticated Crypto Scams
BlackRock’s warnings are timely, given the sophisticated tactics employed by scammers. These fraudsters often create phishing websites and fake platforms that appear credible, using the names of actual BlackRock employees or executives.
They build trust through detailed research on their targets and employ social engineering techniques to extract personal information. Scammers also create a sense of urgency, leveraging the volatile nature of crypto markets to pressure individuals into making quick decisions.
Conclusion
BlackRock's warning is a wake-up call for the investors, as the cryptocurrencies go mainstream through ETFs the interest of investors and scammers both rises. The company recommended investors check the legitimacy of any investment opportunity and beware of the fraudsters impersonating them.
