A growing number of Australians are being drawn into potential cryptocurrency scams fueled by social media hype, according to a recent study by the University of Queensland. The study reveals that nearly 30% of Queenslanders are venturing into the crypto market through social media platforms, often without conducting proper research or understanding the risks involved.
Sydel Sierra, a well-known crypto analyst based on the Gold Coast, cautions first-time investors to take a more measured approach to avoid falling victim to scams. “Most people trust stocks because they’re regulated and have a long history,” she explained. “But then they apply that same logic to crypto, which is still a very new investment and technology. They think it’s 100% trustworthy and end up getting burnt.”
The allure of quick and easy returns is a common pitfall for new investors, Sierra noted. Last year, the Australian Taxation Office (ATO) reported that over $170 million was lost to scams, many targeting hopeful individuals eager to enter the crypto market. “People trust these third parties – ‘send us $10 and get $20 back’ – and all these sorts of things, and that’s where people get really burnt,” Sierra warned.
Sierra, who has earned the moniker “crypto queen” after retiring at 30 thanks to her successful crypto trading strategies, shared her insights on how to protect oneself in the volatile crypto market. “My advice is to start with the most popular coins and always keep your cryptocurrencies in a wallet that you control,” she advised, emphasizing the importance of maintaining personal control over one’s digital assets.
She also highlighted the dangers of relying on automated trading systems or trusting celebrity endorsements. “Anything that does automatic trading for you – trading bots, anything with celebrity endorsement or Twitter posts offering really overpromised returns – those are red flags,” Sierra cautioned. “If it’s too easy, it’s probably a scam. If it’s too good to be true, it usually is, and that’s where people get really caught up in the scams of crypto.”
The study underscores the need for increased awareness and education among potential investors, particularly those influenced by social media platforms where scams are prevalent. Sierra’s advice serves as a crucial reminder that while the crypto market offers opportunities, it is also rife with risks that require careful consideration and due diligence.
As cryptocurrency continues to gain traction in Australia, the importance of approaching it with caution cannot be overstated. The warnings from experts like Sierra and the findings from the University of Queensland study should serve as a wake-up call for those looking to dive into the world of digital assets without fully understanding the potential dangers that lie ahead.
