Crypto Scams - What Are Your Legal Defense and Guide to Avoid Being Scammed?

criminal law


September 06, 2021



| Your comment matters, please click here to rate article!

The concept of Cryptocurrency or digital currency has taken the world by storm. The most popular versions being the 'Bitcoin' and 'Ethereum'. Even the people who do not understand the crypto fad are well-versed in 'Bitcoin' and its decade long bull run in valuation. The rise of 'Bitcoin' has been so significant that the term has become synonymous with the term 'Crypto'.

A cryptocurrency can be understood as a digital currency that can be used to buy goods and services functioning on blockchain technology and online ledger record. The most attractive benefits that crypto's offer is its decentralization, avoidance of banking fees, speedy transactions, and high level of confidentiality in comparison to the traditional transaction model. Blockchain technology how now progressed even further to add in smart contract functionalities that are proposed to be revolutionary at best.

Despite the allure that cryptocurrencies offer, there are some core legal issues that should be well understood to ensure that you are not lured into a scam.

Cryptos are not regulated security:

Cryptocurrencies by their very nature, aim to remain decentralized and hence they do not constitute a conventional currency that is issued by a monetary authority with firm checks and balances incorporated. Cryptocurrency is instead supplied as a crypto stock on various exchanges, and they do not constitute 'listed securities'. They are intended to provide many of the same functions as long-established currencies such as the U.S. dollar, Euro or Japanese yen; however, they are not backed or insured by any monetary authority or government. Although, it is seen that some countries are now slowly moving towards this, with Republic of El Salvador becoming the first country to legalize crypto.

Due diligence is the key:

Making maximum use of the unregulated crypto market, fraudsters are at work to lure people into investing in bogus cryptos. Recently there was big hype on buying in on 'Dubai Crypto Currency' which turned out to be a scam. The Dubai government took action and issued a statement to warn the public to be vary of the false information being circulated. Further, the UAE central bank has reaffirmed that it neither accepts nor acknowledges any cryptocurrency in the UAE and that the only recognized legal tender remains to be the UAE Dirham.

When investing in cryptocurrency, choose only the exchange platforms that are regulated in your jurisdiction. Enquire about their license and check for regulatory approval from the Dubai Financial Services Regulatory Authority (DFSA) or Abu Dhabi Global Market (ADGM). Also, read and understand about any 'voluntary liquidation' clauses that such exchanges might have. Further, enquire about their security features, including cold storage and about your options to store your purchased cryptos in Crypto hardware wallets.

Related Links

Copyright © of this article is retained by the author and/or other copyright owners. We explicitly grant you permission to download a copy, without any alteration, of this article for personal non-commercial research or study, without prior permission or any charge. This article can be utilized on your website or for marketing, however, we grant you permission to host this article on your website and no other rights. This content should not be altered in any way or sold commercially in any format without prior permission of the copyright holder. During reference of this article, full biographic details entailing the name of the author, his designation, the institute and the publishing date of the article shall be provided.


No comments found.

Leave a Comment

Your email address will not be published. Required fields are marked *

Want to know more?
Then talk to us.

Client Testimonials

I owe the success of my case to Dr. Hassan's diligent approach. He remained focused, put me at ease and always went the extra mile. Dr. Hassan tirelessly put my case in the best possible light and I cannot thank him enough. I would highly recommend Dr. Hassan - I am grateful to him from the bottom of my heart.

Raphael Lauria
Manager, FME General Trading

Dr. Hassan Elhais is among the best legal consultants I have ever worked with. He has an amazing ability to reduce complex issues into a simple concept that non-legal people can understand. He consistently develops innovative litigation strategies that help us to achieve our ultimate legal goals.

Zhuo Liu

...the extraordinary effort that has been exerted by the staff, and we specially thank Dr. Hassan Mohsen Alhais. Wishing your continues success & excellence...

H.H. Sheikh Saeed Bin
Mohammed Hashir Al Maktoum

I believe everyone should recognize what a difference Dr. Hassan Elhais work has made to people's lives; and especially to our family's life, because we will remain forever grateful to each and every one of his team.

Luis Pozueco

Dr. Hassan Elhais never fears cases that involve exposure and he always gives me his honest assessment of our chances of success, which is invaluable to me.

Bassam Yamout
Director, JM Metal Trading LCC

He aided us not only in providing legal advice but also in all legal issues that required a long term strategic approach to achieve most favorable and optimum outcomes he provided us with high level of professional service.

Philippe Delbecq

Dr. Hassan Elhais is a responsible, reputable counsel who operates to high levels of service.

British Client

Dr Hassan Elhais is responsive, thorough and creative with his advice, and is a valued advisor and legal consultant.

Asma Mattar
Manager, Italian Style

Regardless of the complexity of the matter I know Dr. Hassan Elhais will consider not only legal strategy but also business practicalities in providing advice and litigation options.

Dr. Massimo Hakim
Chairman, Italian Style

I recommend Dr. Hassan Elhais to anyone who says 'I'm in legal trouble'. I was extremely satisfied with the high standard of his work. He has always been there when I have needed him and I refer all my clients, family and friends to him/his firm.

Manish Gupta
Marketing Manager, Express Digital System

Dr. Hassan Elhais was very professional and he listened to my needs. He was very prompt, efficient and always kept me informed. Dr. Hassan Elhais's service was excellent and I would definitely recommend him to friends and colleagues.

James Horsley
British Client

Select your Language:


Main Menu