Cryptoassets are not regulated financial products so please be aware that trading them carries a considerable amount of risk for your capital. Cryptocurrencies are also not covered by existing consumer protection laws and are not suitable for the majority of investors.
Around 8% of UK adults now own some form of cryptoasset, according to the Financial Conduct Authority’s most recent research (December 2025) – a smaller share of the population than a couple of years ago, though the average amount people hold has actually risen. Wherever there’s genuine interest, though, fraudsters follow. UK Finance’s 2026 Annual Fraud Report puts total UK investment scam losses at £221.5 million across 2025 – a 40% rise on the year before, working out at just over £600,000 lost every single day – with crypto consistently near the top of the list of assets scammers claim to be selling.
UK Finance was explicit about one factor behind the jump: artificial intelligence has “significantly lowered the barriers” for criminals running large-scale fraud, making it easier than ever to produce convincing fake investment platforms, automated outreach at scale, and content realistic enough to make a fraudulent operation look genuine. Understanding how these scams typically work is one of the better defences available, alongside a genuine change in the regulatory landscape that’s now underway.
Common tactics worth recognising
1. Convincing adverts and fake endorsements
Social media remains one of fraudsters’ main tools, with professional-looking adverts on platforms like Instagram and YouTube promoting crypto “opportunities”. Some now use deepfakes – AI-generated videos convincingly impersonating real people, including celebrities and public figures who have no actual connection to the scheme – a tactic the Bank of England has itself flagged as a growing concern. These clips can fool even experienced investors, and are specifically designed to borrow a well-known face’s credibility to get past your usual scepticism.
2. Small early “profits” to build trust
Rather than asking for a large sum upfront, scammers often start with a small investment, then show you what looks like a genuine profit on it. Watching a small amount grow can make the whole scheme feel authentic, encouraging larger contributions. When you eventually try to withdraw, you may be hit with invented fees, delays, or – in the worst case – the scammer simply disappears with your money.
3. Manufactured urgency
Being told an opportunity is only available briefly, or that a price rise is imminent, is designed to stop you pausing, researching, or asking anyone else’s opinion. Genuine investments essentially never require an instant decision – if you’re being rushed, treat that as the warning sign it is.
4. Deliberately confusing explanations
Crypto is genuinely technical, and scammers lean on that, using jargon and complex-looking charts to discourage questions while appearing knowledgeable. A legitimate provider should always be able to explain what you’re investing in, and how, in terms you actually understand – if they can’t or won’t, that’s a red flag in itself.
5. Being told to keep it secret
Being asked not to discuss an “opportunity” with family, friends or a financial adviser is a significant warning sign. It’s not about protecting your returns – it’s about removing anyone who might otherwise spot the scam and talk you out of it.
6. Fake wallets and platforms
Convincing fake websites and apps can capture your login details directly, potentially giving scammers a route into other linked accounts. Always check a URL carefully and only download apps through official, verified channels rather than a link sent to you directly.
What’s about to change: crypto regulation is finally arriving
Cryptoassets remain unregulated financial products in the UK today, which is precisely why scams like these have had so much room to operate. That’s changing, gradually. The FCA published its final rules for a full UK cryptoasset regulatory regime on 30 June 2026, with full authorisation required for any firm serving UK customers from 25 October 2027. From that date, checking a platform’s FCA authorisation on the Financial Services Register will become a genuinely meaningful due-diligence step, in the same way it already is for regulated investments.
In the meantime, it’s worth knowing that today’s landscape is more limited: existing crypto firms only need to be registered with the FCA for anti-money-laundering purposes, which is a considerably lower bar than full authorisation and doesn’t offer the same consumer protections. You can still check the existing register as one part of your due diligence, but until October 2027, “buyer beware” remains the reality for crypto more broadly, whatever a platform claims about its credentials.
Talk to us before you commit
As financial planners based in Poole, we’re always happy to talk through a crypto opportunity with clients across Bournemouth and the wider Dorset area before any money changes hands – a second opinion costs nothing and takes the pressure off a decision that shouldn’t be rushed in the first place. Please get in touch if you’d like to talk something through.
Get in touch before you commit to any investment opportunity you’re unsure about.
This article is for general information only and does not constitute advice. The information is aimed at retail clients only. All information is correct at the time of writing (September 2026) and is subject to change in the future.
Cryptoassets are not regulated financial products so please be aware that trading them carries a considerable amount of risk for your capital. Cryptocurrencies are also not covered by existing consumer protection laws and are not suitable for the majority of investors.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.