Crypto romance scams are relatively new in the US, but they’re already taking a massive toll.

Seth* was almost 30 when he started to date for the first time. He’d married his high school sweetheart just after college and they’d recently opened up their relationship. Excited to check out this whole new world, he hopped on a couple of dating apps and started setting up dates.

One woman, Masha Li, caught his interest right away. She was a beautiful immigrant from Singapore, living in a neighboring town, and they shared many of the same interests. They moved from the dating app to WhatsApp and started exchanging photos, videos, voice messages, and even had an intimate video call that didn’t include their faces.

Seth developed strong feelings pretty quickly and Masha seemed to feel the same. She told him she loved him; they chatted every day; and even tried to meet up in person. About a week into their relationship, Seth asked Masha what some of her hobbies were. She told him she was really into investing in cryptocurrency and he said that was something he’d also been looking into. They quickly moved on to other topics, and Seth didn’t think much about the exchange until Masha brought it up again about a week later. 

At that point, Seth thought: Why not? He’d been considering investing in crypto and here was someone who was willing to guide him through the process. And, a few weeks later, Masha helped him invest $200 on the website bsvglobal.cc. 

That $200 quickly turned into $240 and Seth was thrilled. He withdrew the money, but Masha was pushing him to invest more. At first he refused, but then he started thinking about the plans his spouse had to build a tiny house and live in it. Why not finance that dream with cryptocurrency investing? He’d already seen that it could work; it seemed like a no-brainer. “Looking back, I was definitely vulnerable,” Seth tells Avast.

So Seth went all-in. His spouse withdrew the $5,000 they had in their 401k and gave it to him to invest. He went through the site Masha had recommended again, figuring that if it had worked the first time, then it was safe to use again. And before he even made the deposit, she warned him that the site would charge a fee for “very, very large withdrawals.”

Just like before, his $5K quickly became $6K. Masha was ecstatic and suggested he invest even more. When he told her they didn’t have any more money to invest, Masha offered to loan him money to keep trading. He refused her offer but she kept pushing — and she started getting belligerent. 

That’s when Seth decided to stop ignoring the many red flags that Masha had explained away throughout their relationship and get out of this investment scheme. But when he went to withdraw the money, as he’d done before, the site told him that he had to pay a 25% fee — or $1,500 — in Bitcoin. And he just didn’t have it: He’d used up all of his money on the investment and there was no way for him to get it out. 

Masha kept pushing and pushing for him to stay and keep investing, but he refused. That’s when she told him that she knew where he and his spouse lived and was going to send “street thugs” to their house to beat them up. Seth blocked Masha on all platforms and went to the police. He never spoke with her again — and he still hasn't got his $5,000 back. 

Crypto romance scams are on the rise

Seth was a victim of an emerging trend in online scams: Cryptocurrency-based romance scams. According to the US Federal Trade Commission (FTC), crypto romance scams started cropping up in the United States in late 2021. The scam originated in China, where it’s known as "pig butchering," or “sha zhu pan” (杀猪盘), because the scammers “fatten” up their victims with compliments and loving gestures before they “slaughter” them by stealing their money.

Crypto romance scams are relatively new in the US, but they’re already taking a massive toll. The FTC found that victims lost $139 million in crypto romance scams in 2021 alone, a number that’s almost five times the amount lost in 2020 and more than 25 times the reported losses in 2019. These scams are especially successful because they take advantage of of both emotional vulnerability and the relative lack of knowledge that the general public has about cryptocurrency.

Signs you’re being targeted for a crypto romance scam

Crypto romance scams follow a similar format to other romance scams. The scammers use social engineering to gain the trust of their targets. They often use dating apps, but quickly move to encrypted apps — like WhatsApp — where they’re not subject to the rules of the companies. They “love bomb” their targets, making them feel special and loved very quickly, but there’s always a reason they can’t meet up in person. Some even refuse to talk on the phone or video chat, giving excuses like they’re shy or their camera is broken. Then, once they know they’ve made an emotional impact, they start the scam. 

While all romance scams follow that basic format, crypto romance scams have a few unique red flags. The first is that the scammer will likely have a heavy Chinese accent. Now, obviously that’s not to say that everyone with a heavy Chinese accent is a scammer! But this scam did originate in China and many of the scammers targeting victims outside the country are still Chinese. So a heavy Chinese accent is not in and of itself a red flag, but if a person is following the format of a romance scam we just outlined, take it into consideration. 

Another telltale sign that you’re being targeted by a crypto romance scammer is if they “help” you invest a small amount and then are totally okay with you withdrawing it once you’ve made some money. Masha did this to gain Seth’s trust, showing him that the site she recommended was legitimate.

Unfortunately, we now know that the site wasn’t legitimate. Not only was Seth not able to withdraw his money, but the site no longer exists. When he did a little digging, he realized that it had only been set up only a few months earlier and even though cryptocurrency is relatively new, a brand new site is a huge red flag that it’s not legitimate.

Once the victim has had some minor success, crypto romance scammers will encourage them to invest more. This is where Masha got pushy — and Seth started to wise up to what was happening. Masha’s offer to loan Seth money to continue investing is another common red flag indicating that a scam is in play: Scammers do this to keep their victims on the hook.

Finally, a crypto scam site will insist on a very high fee in order to withdraw the victim’s investment. Legitimate cryptocurrency exchanges do charge fees, but typically they’re less than 1% per transaction. For example, the popular cryptocurrency exchange Coinbase charges  a 0.60% “taker fee” (which is a fee for withdrawing money from the exchange) for investments under $10,000. That’s their highest percentage — and it’s a far cry from the 25% required by the site Masha recommended. 

And while Seth didn’t have the money to pay the “fee,” it’s important to note that other people have tried — and they still didn’t get their money back. It’s likely that the “withdrawal fee” is just one more way to squeeze every last drop out of victims before letting them go. Or, in the case of Masha, going nuclear by threatening their physical safety. 

What to do if you think you’ve been scammed

Crypto romance scams are pretty new, but the FTC numbers show that they’re on the rise. They’re especially effective because:

1. Most people don’t know much about cryptocurrency.
2. They prey on people’s genuine desire for love and romance.
3. Cryptocurrency is nearly impossible to recover once it’s stolen.

Number three is, unfortunately, the harshest reality of this kind of scam. Not dissimilar to gift cards — the current favorite payment method for romance scammers — crypto can’t usually be retrieved once it’s out of your possession. In fact, cryptocurrency was designed specifically to be untraceable, which is great if you’re a political dissident trying to avoid a tyrannical government, but not so great if you’re a victim of a scam. 

So if you think you’re being scammed, the best thing to do is follow Seth’s lead: Block the person, report them on the site where you met, report them to the police, and report the scam to the FBI. Do not pay any “withdrawal” fees and do not accept offers from the scammer to “loan” you money. And while you might not get your money back, take solace in the fact that you’re helping other people avoid the same fate by reporting — and maybe even helping law enforcement put the scammers out of business.