Breaking the Trust Barrier to Beat Crypto Scams

Cryptocurrency Exchanges in Australia Combatting Scams

Cryptocurrency exchanges in Australia have been taking preventative measures against scams by communicating with their users. According to local crypto firms, this is the key to thwarting scams as it can “break trust” between victims and scammers.

At the Intersekt 2023 fintech conference in Melbourne on Aug. 31, executives from major Australian crypto firms such as Cointree, CoinSpot and Swyftx discussed the issue of scams and fraud in the crypto world.

The panel shared a variety of measures that platforms have taken to protect their users from fraud, including automated and manual Anti-Money Laundering (AML) checks, investigations, education and communication.

CoinSpot AML officer Jedda Stocks-Ramsay highlighted the importance of “just talking” to customers, which has proven to be an effective strategy for building trust and preventing scams.

Communication and Education are Vital to Protect Crypto Users

“We find that we’ll speak to our customers at least once over the course of their life or the course of their life on their account with us,” Stocks-Ramsay stated. He noted that discussing scams is the key factor because there’s a social engineering aspect to that.

CoinSpot has particularly focused on assisting customers in understanding the issue of trust that scammers attempt to build with their victims, Stocks-Ramsay said. The executive highlighted that scammers often spend hours on the phone with victims, and a simple email from the exchange could help users avoid this altogether. He added:

In addition to communication, education is another important element of protecting crypto users, Swyftx executive Jason Titman noted. He stressed that often, the reason why individual consumers are prone to being tricked into disclosing their personal data and passwords to scammers is due to a lack of knowledge about the web 3.0, blockchain, and cryptocurrency.

“It’s always been important because, as this is a new asset class, we’ve been educating our customers, particularly something that’s very relevant and important,” he noted.

Cryptocurrency Scams and Web 3.0

Panel speakers highlighted the importance of educating users beyond the cryptocurrency industry, as crypto scams are “not crypto’s fault”, according to Cointree CEO Jess Renden. She added that crypto firms in Australia have been actively communicating with regulators and other businesses, such as telcos and social media platforms.

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Data from the Australian Competition and Consumer Commission reveals that in 2022, locals lost approximately $150 million through investments that used cryptocurrency as the payment mode, representing an increase of more than 160% from 2021.

Cointelegraph author Tom Mitchelhill contributed to this report.

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