It should be noted that officials have commented quite often on what is happening in the cryptocurrency industry. For example, in May 2022, senators raised concerns about Fidelity Investments’ desire to integrate Bitcoin into a 401(k) pension plan. They quite predictably believe that cryptocurrencies are highly unreliable and volatile, and this allegedly creates risks for retirees.


However, for some reason, they didn't take into account the huge returns on BTC and other coins over the long term - nor did they consider record inflation in the economy. Read more about the situation in a separate article.


Fighting fraud in the cryptosphere

According to Brown, companies should disclose the process by which certain applications are deemed secure enough to be hosted by customers. Here’s his rejoinder, in which the expert shares his thoughts on what’s happening.

Cybercriminals steal company logos, names and other identifying information of cryptocurrency firms and then create fake mobile apps to trick unsuspecting investors into believing they are doing business with a legitimate cryptocurrency firm.

As a reminder, such clone apps are a really big problem for the coin industry. And it has reached such proportions and losses for victims that FBI officials, among others, have begun to warn about the situation. As they reported in mid-July, American investors have lost at least $42.7 million just because of fake platforms.

Fraudulent apps often steal their victims’ passwords and private keys

Problems with fraudulent apps pop up in the cryptosphere news every year. Unfortunately, no major centralized platform is yet fully protected against crypto fraud of any kind. For example, there are hundreds of thousands of bots on Twitter that scam ordinary investors every day, and YouTube channels where crypto is constantly being stolen under the guise of giving it away for free.

The latter scheme is as simple as possible, but because of the influx of newcomers to the cryptocurrency industry, it works without fail. Essentially, the scammers hide behind well-known names or companies, and report a high-profile event that is supposedly causing a coin giveaway. The criminals ask to send them any amount ostensibly to confirm the address, after which they promise to double the amount of coins and send them back. Naturally, this does not happen and the money remains with the scammers.

According to Decrypt’s sources, the topic of digital asset-related issues was also raised by Brown during a US Senate Banking Committee hearing this week. Here’s a quote from his report.

Bitcoin can be used for classic fraud schemes such as pyramid schemes and fictitious investments promising big returns with no risk. New ways to defraud people are not the innovations most want to see in the economy.

Note that regular money can also be used for fraudulent schemes. Therefore, to blame Bitcoin and cryptocurrencies in general here is at least unfair and unjust.

The senator didn’t miss the opportunity to mention the collapse of large crypto funds and platforms like Celsius and Voyager Digital. Here is his rejoinder.

Over the past two months, we have witnessed a spectacular disaster in the crypto market, exposing both the alarming interconnectedness and the huge risks of cryptocurrencies.

Senator Sherrod Brown

Following his speech, Brown pledged to increase pressure on US financial regulators to take action to crack down on cryptocurrency fraud. The main thing is that this initiative doesn’t turn into a “witch hunt”, i.e. drastic restrictions for the very crypto projects. Though judging by the senator’s illogical remarks, he may not have much understanding of the details of how blcochain and digital assets work, so expect fair regulation is cautious at best.


We believe that fraud is indeed a hindrance to the cryptocurrency industry, but that does not mean that coins are the problem. In any case, they remain a tool that people use at will. On top of that, fiat money is also suitable for cheating schemes, but for some reason the senators do not criticise it.


What do you think about it? Share your opinion in our millionaires’ cryptochat. There we will talk about other important topics that affect the decentralised finance industry in one way or another.