Feb 17, 2023

Romance Scams Defy Crypto Price Slump, Victim Losses Reach $16K

Crypto asset prices took a dive in 2022, resulting in a 46% drop in crypto scam revenue for the year. However, two scam types managed to remain relatively unscathed — romance scams and giveaway scams.

According to a Feb. 16 crime report from Chainalysis, which examined crypto scam revenue from 2017-2022, crypto scam revenue amounted to $5.9 billion in 2022. The firm attributed most of the decline to poor market conditions, as lower crypto prices generally result in lower scam performance.

Yearly crypto scam revenues from 2017-2022. Source: Chainalysis.

Romance scams, while having lower overall revenue as a category, had the highest average victim deposit size in the year — with the average victim losing just under $16,000, nearly 3x more than the next biggest scam type.

Average losses for victims throughout 2022 by scam type. Source: Chainalysis.

Chainalysis explained that these scam types are most likely to persist when crypto prices are down because they play to a victim’s compassion rather than greed.

“That kind of emotional pitch is probably equally effective regardless of trends in the wider market, because the victim’s primary goal isn’t to get rich quick, but rather to help someone they believe to be a potential romantic partner,” the firm wrote.

Romance scams, and particularly “pig-butchering” scams, have been seen as a growing area of concern within crypto. For example, a United Kingdom investigation published on Jan. 29 found that half of all crypto companies involved with scams in the state were linked to pig-butchering scams.

The report also highlighted the importance of NFT marketing and promotion for crypto businesses. NFTs have become increasingly popular in the web3 space and have the potential to drive significant revenue for businesses that are able to effectively market and promote them.

Twitter is a particularly effective platform for NFT promotion, with many businesses turning to Twitter NFT marketing agencies to help them reach a wider audience. These agencies are experts in leveraging the platform to reach potential customers and help businesses to sell their NFTs.

It’s clear that crypto scams remain a major threat to the industry. However, the data from Chainalysis shows that there are still opportunities for businesses to capitalize on the growing demand for NFTs and use effective NFT marketing and promotion strategies to drive revenue.

Disclaimer: All investment or financial opinions expressed by MoonLanding Media are not recommendations and are intended for entertainment purposes only. Do your own research prior to making any kind of investment. This article has been generated based on trending topics, has not been fact checked and may contain incorrect information. Please verify all information before relying on it.