Crypto Scams: How to Spot the Warning Signs and Protect Yourself

October 22, 2025

Understanding the Rise of Crypto Scams

Cryptocurrency remains one of the fastest-growing investment areas in the UK, but it’s also one of the riskiest. As more people buy into digital assets hoping for big returns, fraudsters are finding new ways to exploit that interest. From fake exchanges to “pig butchering” romance scams, the tactics used in 2025 are becoming more sophisticated and convincing – making it harder than ever to tell what’s real and what’s not.

Understanding how these scams work – and what steps to take if you’ve been affected – could help you avoid further loss and make informed decisions.

Why Crypto Scams Are on the Rise

Crypto’s popularity has exploded in recent years. Social media, influencer culture, and easy-to-use investment apps have helped normalise digital currency trading – but they’ve also opened the door to sophisticated criminal activity.

Fraudsters often use a mix of technology and manipulation. They create convincing online profiles, fake investment dashboards, and even cloned company websites to appear legitimate. Many scams are international in scale, targeting victims in the UK through online platforms and messaging apps.

Common Types of Crypto Scams in the UK

Crypto scams come in many forms. Some look like legitimate investment opportunities, while others exploit personal trust. Here are some of the most common types seen in 2025:

  • Investment platform scams
    Fake trading platforms or crypto wallets mimic real ones. Victims believe they’re investing but their money is taken immediately.
    Example:  A fake investment platform called “BitQueen” circulated on social media, imitating legitimate crypto exchanges. This scam also operated as a Ponzi scheme – meaning earlier investors were paid “returns” from new investors, creating an illusion of a profitable investment.
  • Romance or “pig butchering” scams
    Scammers build personal relationships, often on dating apps, before persuading victims to invest in fake crypto opportunities. UK authorities have warned that victims may even be targeted a second time by fake recovery offers.  Victims of Pig Butchering scams are commonly shown convincing-looking apps or websites with fake balances, profits and market activity. 
    Example: A Southeast Asian group known as “The Prince Group” used these tactics to target victims globally.
  • Impersonation scams and fake celebrity endorsements
    Fraudsters impersonate trusted individuals to deceive victims. This includes criminals misusing names and images of public figures like Martin Lewis, Deborah Meaden, and Elon Musk in fake ads to promote scam crypto platforms.
  • Phishing and wallet theft
    Victims are tricked into revealing passwords or transferring crypto to a “safe” wallet — which is actually controlled by the scammer.

What to Do If You’ve Been Scammed

Act quickly if you suspect you’ve been targeted:

  1. Stop all contact with the suspected scammer.
  2. Report it to Action Fraud or call 0300 123 2040.
  3. Inform your bank — especially if money was transferred from a UK account.
  4. Keep all evidence: emails, texts, receipts, screenshots.
  5. Be cautious of recovery scams – fraudsters may pose as claims experts. Always check a firm is authorised by the FCA before engaging.

! Fake “FCA recovery scams” surged in 2024, with over 10,000 reports of impersonation scams, according to the Financial Conduct Authority.

Can You Recover Lost Crypto?

Recovering cryptocurrency can be complicated, and digital assets themselves are not covered by the Financial Services Compensation Scheme (FSCS).

If your UK bank account was used to send money to a scam – crypto or otherwise – you may be able to ask your bank for reimbursement.
New rules from the Payment Systems Regulator mean banks must now refund victims of certain frauds known as Authorised Push Payment (APP) scams, but this only applies to payments made between UK accounts using Faster Payments or CHAPS.

Payments sent overseas or into cryptocurrency platforms aren’t automatically covered by these rules.

However, you can still raise a complaint if you believe your bank didn’t act properly – for example, if it ignored warning signs or failed to question unusual activity on your account.

If you’re unhappy with your bank’s decision, the Financial Ombudsman Service can review your case to decide whether a refund would be fair.

You can read more about Crypto Scam claims

Crypto Scams: Staying Safe in the Future

  • Be cautious of any investment promising high returns with little or no risk.
  • Always verify websites and apps — look for typos, missing contact info, or unsecure URLs.
  • Don’t trust celebrity endorsements unless verified through official sources.
  • Enable two-factor authentication on wallets and exchanges.

Awareness is your best defence. The more you understand how scams operate, the better equipped you’ll be to avoid them.

How Compensation Adviser Can Help

Compensation Adviser is an FCA-authorised claims management company.

We help people affected by crypto scams understand their options – especially if a UK bank or regulated firm may have failed in its duty of care.

We offer a free initial assessment and will clearly explain your options and can also manage the process for you if you decide to proceed with our service.

Important Information

You don’t have to use our service – you can complain for free to the bank, business, Financial Ombudsman, or FSCS (if eligible).
Our success fee is 15% + VAT of compensation, capped at £7,500 + VAT. No win, no fee (cancellation charges may apply).
No guarantee of success or compensation.
Compensation Adviser is a trading name of Pension Claim Consulting Ltd, authorised and regulated by the Financial Conduct Authority (FRN 829766).

About the Author

This article was produced by Compensation Adviser, part of Pension Claim Consulting Ltd – an FCA-authorised CMC (FRN 829766).

Compensation Adviser specialise in financial mis-selling claims such as Crypto Scams, Mis-sold Investments, Bank related scams and APP fraud.

Our content is based on official sources, consumer-protection updates, and FCA guidance to help you make informed choices.

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