Austrian regulators say crypto scams are the most reported forms of investment fraud in the country ahead of the usual suspects like stock or gold schemes. Authorities in the country are trying to firm up virtual currency regulations to combat the menace of such criminal activities while regulated trading in digital assets continues to enjoy increased patronage in the country.
Crypto Scams Dominate Investment Fraud in Austria
According to BNN Bloomberg, the Austrian Financial Market Authority says there was an increase in financial fraud whistleblowing involving cryptocurrency investments. Indeed, the FMA said two-thirds of all reported financial scams involved crypto investment programs.
The Austrian financial regulator also revealed that these elaborate scams were being advertised by social media channels like TikTok, Telegram, and WhatsApp. This rise in crypto scams in Austria has also dwarfed that of gold and stocks which were the usual commodities targeted by fraudsters.
Commenting on the need for tougher regulations to stem the rising tide of crypto scams, Klaus Grubelnik, a spokesperson for the FMA remarked:
“We see a great need for stricter regulation. Fake offerings for stocks and gold have been around forever and these scams are now shifting to digital assets because of the hype.”
For Grubelnik, the cross-border nature of crypto scams has necessitated the emergence of international cooperation in investigating these crimes. The FMA spokesperson comment echoes that of finance minister Hartwig Löger back in 2018 who called for a common European approach to crypto regulations in the fight against money laundering.
Löger’s remarks at the time was amid the furor of the Optioment Bitcoin pyramid scheme that defrauded over 10,000 victims across different countries to the tune of about 12,000 BTC.
As previously reported by BTCManager, the FMA warned against Bitcoin Trader, an unlicensed Bitcoin investment scheme back in July 2019.
Booming Cryptocurrency Commerce in Austria
Despite the instance of fraud, Austria’s crypto and digital currency scene continues to grow with several examples of significant adoption. Regulated exchanges like the Vienna Stock Exchange have launched crypto exchange-traded products (ETPs) and other cryptocurrency-related derivatives.
Back in July 2020, A1 Telekom, one of the largest mobile telecoms operators in Austria launched a cryptocurrency payment feature as part of its services. In April 2019, regulators also announced plans to introduce a regulatory sandbox for fintech and digital assets firms in the country.