$9.3 Billion Lost to Crypto Scams: How to Protect Yourself in 2026
As cryptocurrency investments continue to attract a growing number of investors, the darker side of digital currency is becoming increasingly apparent: scams targeting crypto holders are surging nationwide. In 2024 alone, the FBI reported nearly $9.3 billion in cryptocurrency-related losses — a staggering 66% increase from the previous year.
Rising Losses in Washington and Beyond
Washington state has been hit hard by crypto fraud. In 2023, residents lost approximately $141 million to scams involving cryptocurrency kiosks, devices where users can buy virtual currency in person. These kiosks, which operate somewhat like traditional ATMs but transact digital rather than physical money, have become a common tool exploited by scammers.
Common Tactics Used by Scammers
Rather than sophisticated hacking, many crypto scams rely on manipulating people rather than computer systems. Alan Draper, Head of Content at Crypto News, explained that scammers typically build trust through social engineering—posing as successful traders or reputable investors on social media or by phishing emails. Over time, they gain victims’ confidence, only to coax out private keys or passwords, granting them control over the victim’s assets.
“Scammers rarely hack systems,” Draper said. “They are hacking people. They build relationships, project success, and exploit trust before asking for money.”
Fake investment opportunities often promise “risk-free” returns or secret strategies that guarantee profit—classic warning signs of fraud.
Warning Signs and Safety Tips
Crypto News recommends that investors, both new and experienced, stay vigilant against scams by observing these red flags:
- Pressure to act quickly: If an investment opportunity insists urgency because “spots are limited,” be cautious.
- Requests to move conversations off reputable platforms: Moving communications to private messages or unverified channels is a common tactic.
- Vague explanations for how profits are made: Legitimate investments clearly explain earnings structures.
- Encouragement to recruit friends or family: If asked to bring in others to increase profits, beware.
Another critical tip is never to share private keys or seed phrases. These are the digital equivalents of passwords and allow full access to cryptocurrencies. Experts recommend using hardware wallets for long-term security and enabling two-factor authentication on all crypto-related accounts.
Alan Draper advises, “If you feel pressured or confused, it’s time to step back.”
Spokane Takes a Stand Against Crypto Kiosk Scams
Recognizing the growing threat to its citizens, the Spokane City Council in Washington took unprecedented action in June by unanimously voting to ban all cryptocurrency kiosks. Spokane is the first city in the state to enact such legislation, aiming to protect the most vulnerable residents, including seniors often targeted by scammers pretending to be law enforcement or IRS agents.
Detective Tim Schwering from the Spokane Police Department highlighted how these scammers exploit fear and authority, coercing individuals into purchasing cryptocurrency from kiosks under false pretenses such as avoiding jail time.
Protecting Yourself in 2026
As crypto scams evolve, awareness and caution remain the best defenses. Remember:
- No legitimate crypto investment offers guaranteed or “risk-free” profits.
- Guard your private keys and seed phrases meticulously.
- Be skeptical of unsolicited investment offers and high-pressure tactics.
- Use hardware wallets and two-factor authentication to secure your assets.
For ongoing updates and advice on navigating the cryptocurrency landscape safely, keep informed through trusted sources and official law enforcement alerts.
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