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- 1 US Financial Industry Regulatory Authority (FINRA) released its annual report, noting crypto, Reg BI, and cybersecurity.
- 2 The 2024 annual report cautions individuals of malicious actors and scams taking place in the crypto universe.
FINRA released its 2024 annual report on Tuesday, covering many of the sectors such as financial management, communication and sales, financial crime, and market integrity. The report also discusses the crypto universe, crypto-asset development, and theft. The report included four new topics that are Cryptocurrency assets, fixed-income securities, market management, and advertised trading.
Why FINRA Mentioned Crypto?
In the freshly released annual report, FINRA highlighted cryptocurrency and issued a warning to individuals engaged in the crypto universe. The rise in crypto scams and malicious actors’ actions seek attention towards the digital asset sector.
The report discusses the key concerns and the need for strict regulations for financial firms operating with crypto-asset-related activities. In addition to this, the report revolves around manipulative schemes and exploitation along with market structure differences.
The manipulative schemes exploited the interest of investors, affecting the equity markets adversely. The scams and hacks directly exploit low market-cap assets to mislead investors.
The distinctive market structure between decentralized and centralized exchanges is considered to be the main reason behind the rising crypto scams. Unstructured markets made it efficient for the bad actors to trap investors in fraudulent schemes, damaging the crypto ecosystem.
Additionally, the top blockchain analytics firm Chainalysis, uncovered many of the phishing frauds, in which targets are misled to support the malicious transaction.
According to Chainalysis, Victims lost around $374.6 million in 2023 whereas the value was approximately $516.8 million in 2022.
Moreover, FINRA also discussed the appropriate market management provided to customers for risk handling. Advertised trading volume to showcase no misrepresentation of the buying or sale of securities is also mentioned in the annual report.
The Rise in Crypto Scams
The scams and malicious actions are gradually raining in the crypto universe. Scam Sniffer, an anti-scam platform uncovered some shocking stats of crypto thefts. The platform disclosed volumes of crypto thefts in 2023, alarming individuals to stay alert and active.
Scam Sniffers platform scanned around 12 Million URLs to date and found around 145K scams. Additionally, the platforms received 4.5 Million queries per day and blocked over 100K sites that underwent scams.
Moreover, the wallet drainers stoles around $295 million in assets from over 324,000 times in 2023. The phishing scams are attempted by different wallet drainers including angel drainers, inferno drainers, MS drainers, Venom drainers, etc.
Exploring the trends it is observed that phishing scams and activities are gradually rising with time, highlighting the requirement for strong regulations.
On the other side, airdrops, paid advertising, organic traffic, and hijacked discords are challenging to find.
Disclaimer
This article is for informational purposes only and does not provide any financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.
Steefan George is a crypto and blockchain enthusiast, with a remarkable grasp on market and technology. Having a graduate degree in computer science and an MBA in BFSI, he is an excellent technology writer at The Coin Republic. He is passionate about getting a billion of the human population onto Web3. His principle is to write like “explaining to a 6-year old”, so that a layman can learn the potential of, and get benefitted from this revolutionary technology.
