Study Finds High Prevalence of Crypto Scams: 35% of Canadian Crypto Holders Victimized
A recent investigation conducted by researchers associated with Toronto Metropolitan University sheds light on the widespread occurrence of crypto scams. According to their data, a concerning 35% of Canadian individuals who own cryptocurrencies have experienced fallen victim to such fraudulent schemes. In addition, the researchers’ work also uncovers a troubling connection between cryptocurrency ownership and online harassment.
The comprehensive report, authored by experts from Toronto Metropolitan University, dispels the misconception that modern crypto investors are impervious to scams due to their advanced knowledge. The findings of this study are based on a national survey conducted in October 2022, delivering a stark wake-up call that demands immediate action. However, policymakers in Ottawa must strike a delicate balance between rigorous enforcement measures and fostering an environment that encourages innovation.
Alarming Increase in Online Harassment Directed at Canadian Crypto Owners
A recent survey conducted in Canada highlights the alarming prevalence of crypto fraud, with a striking 35% of respondents reporting being victims of scams or fraudulent activities. Interestingly, the study identifies a correlation between lower-income and less-educated populations and higher rates of crypto fraud incidents.
Additionally, the research sheds light on the concerning connection between cryptocurrency ownership and online harassment. Nearly 19% of crypto owners surveyed experienced online abuse, in contrast to only 6% among individuals without crypto holdings. The severity of the abuse led to genuine concerns for personal safety among the targeted individuals.
Surprisingly, despite the high levels of fraud, the report indicates that Canadian crypto owners do not consider themselves more susceptible to misinformation compared to their global counterparts.
It is important to note that the survey was conducted in October 2022, predating the downfall of FTX and the subsequent arrest of its CEO, Sam Bankman-Fried. The report underscores the existing apprehensions surrounding cryptocurrencies even prior to these recent developments.
The study presents clear recommendations to the Canadian government to address the challenges in the crypto-asset space. These recommendations include harmonizing financial crypto-asset regulations with other existing Canadian policies and legal frameworks, as well as collaborating with international jurisdictions and organizations to formulate effective policymaking strategies.
| Learn more about How To Identify a Scam Crypto Project |
The latest report reveals a fact that comes as no surprise. When compared to its larger neighbor, the United States, Canada displays a relatively lower interest in cryptocurrencies. According to the recently published Chainalysis 2022 Crypto Adoption Index, which predates the survey, Canada ranks 22nd globally in terms of crypto adoption, while the United States holds the 5th position. The United Kingdom secures the 17th spot.
Nevertheless, Canada outperforms several comparable countries, including France (32), Australia (40), New Zealand (108), the Netherlands (39), and Ireland (124), but falls short of Germany (21).
Researchers from Toronto Metropolitan University provide clear insights into the reasons behind Canada’s cautious approach to crypto usage and trading. The report highlights that Canadians generally exhibit “extremely low” levels of trust in crypto exchanges. The recent controversies surrounding the fall of FTX and other scandals have likely further impacted this sentiment.
Canadian Crypto Exchanges Exit the Market
Efforts to combat scams and fraud in the Canadian crypto market come with the delicate task of not driving away exchanges. The key lies in implementing smarter regulations that foster a safe environment for investors. However, recent developments have raised concerns.
In response to heightened scrutiny mandated by Canadian securities administrators, Bybit, a Dubai-based exchange, recently revealed its decision to halt operations in Canada. The company will no longer accept new Canadian residents or nationals as customers and existing traders must close their margin positions by September 30 to avoid automatic liquidation.
Adding to the concerns, Binance, the world’s largest cryptocurrency exchange, also announced its exit from the Canadian market in May, citing similar reasons. These developments highlight the challenges faced by Canadian authorities in striking the right balance between regulation and maintaining a vibrant exchange ecosystem.
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