Authorities in Austria, collaborating with counterparts from three other countries, have launched a coordinated crackdown on an online scam posing as a new cryptocurrency venture. The European Justice for Criminal Justice Corporation, in conjunction with Europol, revealed in a press release on May 8 the details of their joint effort to apprehend scammers who falsely claimed to have established a company launching a new crypto asset.

Operating from Austria, the fraudsters allegedly developed proprietary software and algorithms between December 2017 and February 2018. They lured investors by offering 10 million tokens in exchange for rights to purchase the purported new cryptocurrency. Unfortunately, investors suffered substantial losses totaling €6 million, with the potential for this figure to increase as not all victims have been identified.

This recent incident is reminiscent of similar scams reported in the past. In November 2023, crypto.news highlighted a case where the FBI arrested three individuals for exploiting security vulnerabilities in banks, resulting in a fraudulent gain of over $10 million, which was then converted into cryptocurrency. Furthermore, in March 2024, a British citizen named Wen Jian was convicted by a London court for defrauding over 130,000 investors of $6 billion between 2017 and 2022.

The prevalence of such scams has led to significant financial losses for investors. In February 2024 alone, investors reported losses exceeding $412 million to scammers. However, in April 2024, cryptocurrency scams and exploits resulted in losses amounting to $25.7 million, marking the lowest figure recorded in three years. Additionally, PeckShield, an on-chain security firm, reported a decrease in losses from crypto attacks and scams during April, marking the first significant decline observed in 2024.