Russia’s Central Bank Concerned As Crypto Scammer Open Offices

According to the Central Bank of Russia (CBR), more crypto and financial pyramid firms are now introducing physical offices in Russia. The CBR has expressed worry noting that increased demand must have caused them to open physical offices. 

Russian Crypto Scammers Open Offices To Entice Unsuspecting Investors – CBR

In 2022, there has been a hike in crypto scams causing unsuspecting investors to lose millions. Meanwhile, the daily Izvestia revealed that Russia’s number of crypto scams has recently increased.

The CBR has announced that illegal forex dealers and pyramid schemes offering crypto investment are going offline. These entities are now launching physical offices where they can lure victims in person. 

This occurrence is the first of its kind in recent times. These perpetrators have opened offices to appear credible to investors. 

Some of their activities include offering crypto investment to potential victims and suggesting ways to bypass government and foreign sanctions. According to experts, it is easier to convince individuals to invest in person.

Also, the regulator has warned Russians about sharing their information with dubious platforms. The report also noted that these entities hope that demand for their services will increase.

Meanwhile, it is worth saying that western sanctions on Russia after its attack on Ukraine have increased the interest in digital assets. Reports reveal that most citizens have invested in various cryptocurrencies, such as BTC and stablecoins, to protect their funds.

Increase In Crypto Fraud Due To Western Sanctions 

Meanwhile, a report from the central bank of Russia revealed that financial pyramid scams have become rampant in 2022. In Q1 2022, the watchdog identified over 954 entities running pyramid scams.

This value is higher compared to just 146 in Q1 2021. This is an increase of over six-fold. Also, the number of firms offering fake or real crypto investments is still growing. 

The central bank also noted that over 56% of such entities have advertised crypto investments or raised crypto funds. According to the CBR, recent sanctions on the country have affected foreign asset investments and international settlements. 

These changes have caused financial institutions and investors to look for alternative means to conduct transactions. However, fraudsters and criminals are exploiting this to defraud unsuspecting individuals.

The central bank recently eased some restrictions on Russian access to foreign currency. This has allowed banks to increase their supply of Euro and USD to the public. 

However, it is uncertain if this would shift people’s interest in cryptocurrency. Currently, the usage of crypto in the country had increased compared to when there were no sanctions.