Kuwait Cryptocurrency Scam: Traders lose 40 million kd

Cryptocurrency fraud had reached Kuwait just this January, leaving investors puzzled after an estimated 40 million KWD ($130 million) disappeared in a matter of hours. This event was shortly followed by the collapse of a cryptocurrency named ‘Bitcoin Kuwait’.

This idea allegedly stemmed from an anonymous developer over three years ago, promising investors returns. This scheme was exposed by Dr. Safaa Zaman, a professor of computer science at Kuwait University. According to Dr. Zaman, the creators of the token had disappeared, stealing all invested funds. She explained that most of those affected were young and inexperienced traders, the target audience in these kinds of investment scams.

It was also mentioned that here in Kuwait there is currently no legislation in order to prevent such crimes. Although, there has now been a framework put into place to shield the public from these cryptocurrency scams. Dr. Zaman added that the Central Bank of Kuwait prohibits the dealing of digital assets, but efforts to enforce these laws still lack. Unfortunately, the individuals who lack financial literacy are those who are susceptible to manipulation — all logic is clouded when being told of the opportunity to make large sums of money off of crypto.

Cryptocurrency mining is how transactions are validated and recorded on a blockchain network. It uses substantial amounts of electricity due to the computational power required and, in countries with fragile power grids, mining has been blamed for blackouts as well as energy shortages. Some governments ban it to protect national energy security or cut down on emissions. Mining sometimes funds or hides money laundering, tax evasion, and ransomware operations