Cryptocurrency has created life-changing opportunities for investors, but it has also opened the door to some of the most devastating financial crimes in history.
In 2024 alone, reports estimated that over $54 billion was lost to scams and fraud in the crypto space.
This makes scams one of the biggest threats to anyone looking to invest in digital assets.
These 5 biggest crypto scams of all time prove how quickly hype, trust, and poor regulation can lead to catastrophic losses.
The scam had collectively wiped-out tens of billions of dollars from investor portfolios, destroying life savings, retirement funds, and institutional capital.
From elaborate Ponzi schemes to sophisticated exchange collapses, each catastrophe reveals critical vulnerabilities within the cryptocurrency ecosystem.
The need to understand these monumental failures provides essential insights into recognizing warning signs, implementing security measures, and avoiding similar traps that continue ensnaring unsuspecting investors.
The patterns, methodologies, and aftermath of these scams offer invaluable lessons for navigating today’s complex digital asset landscape.
Why Crypto Scams Keep Happening
Crypto Scams don’t just happen because of “greedy investors.” They thrive because of loopholes in the system and human psychology:
- Weak Regulation: Cryptocurrency remains poorly regulated in many regions. Scammers use jurisdiction shopping to avoid enforcement.
- FOMO (Fear of Missing Out): Many investors skip research because they don’t want to “miss the next bitcoin.”
- Irreversible Transactions: Once funds leave your wallet, there’s no central authority to reverse them.
- Complexity of Crypto: Scammers exploit technical jargon and flashy promises to confuse investors.
Popular scam tactics include:
- Ponzi and Pyramid Schemes with Guaranteed Daily Returns
- Fake Crypto Exchanges with Fabricated Volumes
- Phishing Attacks That Steal Private Keys
- Scams Using Celebrity Endorsements to Gain Trust
5 Biggest Crypto Scams of All Time
1. BitConnect: The Ponzi Scheme That Fooled Thousands
One of the most infamous scams in crypto history is BitConnect, launched in 2016.
It positioned itself as a lending platform that promised daily returns of up to 2.78% using a so-called trading bot.
What fuelled its growth was an aggressive referral program. Users earned commissions for bringing in new investors, turning BitConnect into a classic pyramid scheme.
YouTube influencers, social media marketers, and even public events promoted BitConnect as a “safe” investment.
By 2017, BitConnect’s token (BCC) was trading above $400, with thousands believing they had struck gold.
But in January 2018, regulators issued cease-and-desist orders. The token’s value crashed to under $10 within days, wiping out $2.4 billion.
The critical lesson from BitConnect’s implosion centres on recognizing that legitimate investment platforms cannot guarantee consistent high returns regardless of market conditions.
Promises of daily profits exceeding traditional investment vehicles invariably indicate fraudulent operations.
2. OneCoin: The Fake Cryptocurrency Empire
If BitConnect was shocking, OneCoin was even bigger. Founded in 2014 by Ruja Ignatova, also called the “Crypto Queen,” OneCoin raised more than $4 billion from investors worldwide.
The catch? OneCoin wasn’t even a cryptocurrency. There was no blockchain.
Transactions and balances existed only in a private database controlled by the company.
Yet, through flashy events, professional conferences, and multilevel marketing tactics, OneCoin convinced millions that it would overtake Bitcoin.
Ignatova disappeared in 2017, just before she was about to be arrested. She remains on the FBI’s Most Wanted List with a $100,000 bounty for her capture.
However, in September 2023, BBC reported that the Crypto queen has been jailed for 20 years.
The essential takeaway involves verifying that cryptocurrency projects possess legitimate blockchain networks before investing.
3. PlusToken: The $2 Billion Wallet Scam
PlusToken operated between 2018 and 2019 as a cryptocurrency wallet application that promised high-yield returns through mining rewards and trading profits.
More than 2 million users, mostly in China and South Korea, were affected by this sophisticated fraud that combined wallet functionality with Ponzi scheme economics.
The app worked as a real wallet but also promised monthly returns of 10–30%.
Users deposited Bitcoin, Ethereum, and other cryptocurrencies, expecting payouts.
In mid-2019, the operators disappeared, stealing more than $3 billion.
Authorities later arrested several individuals tied to the scheme, but most of the stolen funds remain unrecovered due to laundering through mixers and exchanges.
The fundamental lesson emphasizes the importance of separating legitimate wallet services from investment opportunities.
Cryptocurrency storage should never be combined with promises of guaranteed returns or unrealistic profit projections.
4. Mt. Gox: Exchange Hack That Shocked the World
In early crypto history, the Mt. Gox exchange dominated, handling over 70% of Bitcoin transactions globally.
But in 2014, it collapsed after hackers stole 850,000 BTC, worth $450 million then and over $50 billion today.
The exchange had weak security. Most funds were stored in hot wallets (always online), making them easy targets.
The hack was not detected for years, and the company used new customer deposits to cover old withdrawal requests, operating while insolvent.
Over 127,000 customers lost their funds, and Bitcoin’s reputation suffered a major blow.
The case forced exchanges worldwide to strengthen security measures.
Mt. Gox’s failure fundamentally changed cryptocurrency security standards and highlighted the critical importance of storing digital assets in self-custody wallets rather than trusting third-party exchanges.
The collapse delayed mainstream cryptocurrency adoption and created lasting scepticism about exchange security practices.
5. FTX Collapse: From Trusted Exchange to Fraud
The FTX collapse in 2022 is considered the biggest crypto fraud in history.
Once worth $32 billion, the exchange was seen as a trusted brand, backed by celebrities, politicians, and institutional investors.
But behind the scenes, FTX was misusing customer deposits to cover risky bets at Alameda Research, a trading firm owned by founder Sam Bankman-Fried (SBF).
When the truth came out, customers rushed to withdraw their funds. FTX couldn’t meet demands, and the exchange declared bankruptcy.
Over $8 billion in customer funds vanished. Some money has been recovered, but most victims still face losses.
The crisis demonstrated that even apparently reputable exchanges with strong reputations can engage in fraudulent activities, emphasizing the importance of diversifying exchange usage and maintaining self-custody of cryptocurrency holdings whenever possible.
Comparison of the 5 Biggest Crypto Scams
| Scam | Year | Estimated Loss | Victims | Type |
| FTX | 2022 | $8+ billion | Millions | Exchange Fraud |
| OneCoin | 2014-2017 | $4+ billion | 3+ million | Fake Cryptocurrency |
| PlusToken | 2018-2019 | $3+ billion | 2+ million | Wallet Ponzi |
| BitConnect | 2016-2018 | $2.4 billion | Hundreds of thousands | Lending Ponzi |
| Mt. Gox | 2014 | $450 million | 127,000 | Exchange Hack |
How To Spot And Avoid Crypto Scams
To protect your money, learn the red flags:
- Promises Of Guaranteed Profits
- Pressure To Invest Quickly or Recruit Others
- No Transparency About Founders or Technology
- Complicated “Too Good to Be True” Returns
- Storing Funds with Platforms That Double as Investment Schemes.
Best Practices for Safety:
- Use Regulated Exchanges with Licenses
- Store Funds in Hardware Wallets for Long-Term Safety
- Enable Two-Factor Authentication on Accounts
- Research Projects Thoroughly Before Investing
- Never Share Your Private Keys or Seed Phrases.
Frequently Asked Questions About Biggest Crypto Scams
1. What was the biggest crypto scam ever?
The FTX collapse is the largest, with over $8 billion lost and millions of victims worldwide.
2. Are crypto scams still common in 2025?
Yes, though regulators are cracking down, new scams like NFT rug pulls, DeFi exploits, and phishing attacks remain active.
3. How can beginners protect themselves from scams?
Yes. Stick to regulated exchanges, use cold wallets, avoid “get rich quick” offers, and never share private keys.
4. Can victims recover money lost in crypto scams?
Recovery is rare. Some money may be recovered through bankruptcies or law enforcement seizures, but most losses are permanent.
5. Which types of crypto scams are most dangerous today?
Social engineering, phishing emails, and fake platforms disguised as legitimate exchanges are the biggest threats.
Final Words
These 5 biggest crypto scams of all time reveal that cryptocurrency investments offer tremendous opportunities alongside substantial risks when investors ignore fundamental warning signs and security principles.
Each fraud demonstrates the importance of thorough due diligence, sceptical analysis of extraordinary return promises, and proper asset security practices.
Every major scam left valuable lessons regarding the necessity of regulatory compliance, transparent operations, and separation between customer funds and operational capital.
The cryptocurrency industry has implemented improved security standards, regulatory frameworks, and investor protection mechanisms in response to these catastrophic failures.
The patterns revealed by these fraudulent schemes provide essential guidance for modern investors navigating an increasingly complex digital asset landscape.
Stay informed about emerging threats, use only trusted platforms with proper regulatory oversight, and maintain control over your private keys to protect your cryptocurrency investments from similar devastation.
