Since 2021, nearly 50,000 people have reported losing over $1 billion in cryptocurrency-related scams. As a private investigator, you may begin to receive requests from clients to investigate this type of fraud. Therefore, it is crucial to have basic underlying knowledge in the field. In particular, if you specialize in providing asset investigations, you’ll want to get up to speed in this area. This article offers cryptocurrency insights for private investigators. Also, it includes a list of cryptocurrencies, cryptos, and tokens and describes each. In addition, it covers the various financial exchanges where they are bought and sold. Also, you’ll find a helpful (and growing) list of terms and definitions.
As of November 8, 2021, the total crypto market was over $3 trillion. In addition, there are more than 200 million users in the market. With so much money in the market and so many people involved, the opportunity for fraud is significant.
List of Cryptocurrencies
First, as a private investigator, you’ll want to familiarize yourself with cryptocurrencies. You’ll often be asked to investigate scams and fraud involving one or more of the following cryptos.
- 1inch (1INCH) – 1inch is an Ethereum token that powers decentralized exchanges.
- Algorand (ALGO): Algorand seeks to improve decentralized applications’ speed, security, and scalability. It pays interest (aka rewards) to holders of its currency.
- AMP (AMP) – AMP is an Ethereum token that acts as collateral for payments on the Flexa Network.
- ANKR (ANKR) – ANKR is a token that powers a Web3 infrastructure and DeFi platform.
- Avalanche (AVAX) – Avalanche is an open, smart contracts platform for decentralized networks.
- Binance Coin (BNB) – Binance Coin is the coin the Binance Exchange offers.
- Bitcoin (BTC) – Bitcoin is the original cryptocurrency, and many consider it the best investment. It allows people anywhere in the world to send money without the involvement of a bank, government, or other financial institution. To learn more about the most popular on this list of cryptocurrencies, visit the website.
- Bitcoin Cash (BCH)—Bitcoin Cash is intended to be peer-to-peer electronic cash. Its goal is primarily to allow people to pay one another without using a financial institution.
- Bonafida (FIDA) – FIDA is a Solana token on Bonafida, the user interface for the Serum decentralized exchange.
- Cardano (ADA)—Cardano is a proof-of-stake, open-source, public blockchain platform. Its crypto Ada is designed to facilitate peer-to-peer transactions. One differentiating factor is that Cardano uses less energy than Bitcoin.
- Chainlink (LINK) – Chainlink is a decentralized oracle network.
- Clover Finance (CLV) – Clover Finance is a blockchain platform that helps facilitate compatibility across chains.
- Crypto.com Coin (CRO) – The Crypto.com coin is, of course, the coin used on the Crypto.com exchange.
- Dogecoin (DOGE) – Sometimes referred to as a “meme coin,” its value tends to be influenced by social media activity. Notably, Dogecoin is a token most often mentioned by Elon Musk. His seemingly casual tweets sometimes influence the coin’s buying and selling.
- Ethereum (ETH) – Ethereum is the second-largest crypto behind Bitcoin. It is a decentralized computing platform that can run various applications.
- Ethereum 2 (ETH2) – A collection of upgrades intended to make Ethereum faster and less expensive.
- Fantom (FTM) –
- Fetch.ai (FET) – Fetch.ai is a machine-learning artificial intelligence platform. FET provides a decentralized finance application that helps users automate their trading activities.
- Horizen (ZEN) – Horizen is a blockchain ecosystem that allows developers to build customized blockchains and decentralized apps.
- Jasmy (JASMY) – The Jasmy IoT platform is based on the “democratization of data.”
- Litecoin (LTC) – Litecoin was designed as a fork of the Bitcoin blockchain. It is intended to be faster and cheaper.
- Livepeer (LPT) – Livepeer is an Ethereum token. LPTs power the Livepeer network, a decentralized video streaming platform.
- Loom Network (LOOM) –
- Loopring (LRC) – Loopring is an open-sourced, audited, and non-custodial exchange protocol. Loopring’s goal is to allow developers to create non-custodial, order book-based exchanges on Ethereum by leveraging zero-knowledge proofs.
- Polkadot (DOT) – Polkadot is designed to allow unrelated blockchains to talk to one another.
- Polygon (MATIC) – Polygon is a token that powers the Polygon Network. The goal is to provide faster and cheaper transactions.
- Quant (QNT) – Quant is an ETH token that connects public blockchains with private networks.
- Render Token –
- SAND (SAND) – A token that powers the Sandbox, a gaming experience in the metaverse.
- SHIBA INU – SHIBA INU is an Ethereum-based meme token developed as an alternative to Dogecoin. However, the tokens are beginning to be used in legit blockchains related to NFTs and decentralized exchanges. As of this writing, SHIB is the least expensive (on a per-coin basis) of any other on this list of cryptocurrencies.
- Solana (SOL) – Solana is both a currency and a platform for running crypto apps. It is a competitor to Ethereum that can perform transactions much faster.
- Stellar Lumens (XLM) – Stellar is a blockchain payment platform.
- Synthetix Network Token (SNX) – A native cryptocurrency of the Synthetix platform, an Ethereum-based decentralized finance (DeFi) protocol, used to collateralize and mint synthetic assets, enabling users to gain exposure to a wide range of traditional and digital assets within the blockchain ecosystem.
- Tether (USDT) – Tether is an Ethereum token tied to the United States Dollar. Coins tied to the U.S. Dollar are also known as “stablecoins.” It is backed by bank reserves, making it more stable than other cryptos.
- TerraUSD (UST) – TerraUSD is a decentralized stablecoin that seeks to maintain a value of one U.S. dollar.
- Tezos (XTZ) – Tezos is a blockchain network and platform for smart contracts. Tezos uses a proof-of-stake (PoS) consensus mechanism. Also, developers can use Tezos to develop decentralized financial applications. Investing in this cryptocurrency allows you to earn a staking reward, similar to earning interest on a bank account.
- TRON (TRX) – Tron is a project that aspires to create a truly decentralized internet.
- Uniswap (UNI) – Uniswap is a DeFi application that allows users to trade crypto without an intermediary.
- UNUS SED LEO (LEO) – A token for the iFinex ecosystem.
- USD Coin (USDC) – USD Coin is a stablecoin that runs on the Ethereum platform. It can be exchanged for U.S. Dollars at a 1-to-1 ratio.
- VeChain (VET) – VeChain is a blockchain development platform.
- Wrapped Bitcoin (WBTC) – Wrapped Bitcoin is an Ether token representing BTC on the Ethereum blockchain.
- Wrapped Luna Token (WLUNA) – Wrapped Luna is a token designed for DeFi apps.
- XRP (XRP) – XRP is the native currency on RippleNet, a blockchain designed to facilitate payments.
- XYO (XYO) – XYO powers a decentralized network of devices.
- Zcash (ZEC) – Zcash is a privacy coin developed by cryptographers to address privacy concerns on the Bitcoin network.
Please visit the website for each crypto for more detailed information on the company and how it works. Again, there are many more than I have on this list, and the number grows daily. I’ll add more to the list as time allows.
List of Cryptocurrencies – The Top 10
Now that we have reviewed a list of cryptocurrencies in general, which ones are the most popular? Private investigators may receive requests to investigate cases involving one or more of the above list. However, most requests will likely include the more popular coins/tokens, as they have the most money. However, given the crypto market volatility, it is difficult to say which are genuinely the best cryptocurrencies to invest in. The one method that most experts would agree on is to consider the market cap. The following list is based on the market capitalization at the time of this writing.
- Bitcoin (BTC) – $1.7 trillion
- Ethereum (ETH) – $520 billion
- Binance Coin (BNB) – $88 billion
- Tether (USDT) – $70 billion
- Cardano (ADA) – $66 billion
- Solana (SOL) – $60 billion
- XRP (XRP) – $50 billion
- PolkaDot (DOT) – $43 billion
- Shiba Inu (SHIB) – $40 billion
- Dogecoin (DOGE) – $38 billion
It is important to note that investing in any coin/token from the above list of cryptocurrencies, like Bitcoin and Ethereum, is highly speculative. The markets are volatile and difficult to predict. They don’t work in the same way as the stock market. Therefore, the overall market and individual currencies may be difficult to understand and predict.
List of Crypto Trading Platforms and Online Exchanges
Now that you’re familiar with crypto knowing where it can be bought and sold is essential. There are only a few good options for buying and selling crypto. The more mainstream trading platforms like Fidelity only offer the option to invest in Bitcoin ETFs rather than individual currencies. The following is a list of the best exchanges:
| Trading Platform | Description |
| Binance | Binance is the largest Bitcoin and altcoin exchange in the world by volume. Binance offers a more advanced trading interface for serious traders. |
| Bisq | Bisq is an open-source desktop application that allows you to buy and sell currencies. |
| Coinbase | Venmo is a payment processor that also offers crypto. Venmo allows users to purchase crypto in amounts as low as $1.00 from the app. However, at this time, they only offer four options: Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. Yes, you can buy crypto this way, and they make it easy. However, if you choose to buy this way, you won’t get access to the same helpful information and data offered by exchanges like Binance, Crypto.com, etc. |
| Crypto.com | Crypto.com is an app-based exchange with low trading fees. |
| eToro | eToro is an Israeli crypto and forex trading company. |
| Gemini | Gemini is a regulated platform that allows you to buy, sell, store, and learn. |
| Kraken | Kraken is an online trading platform that allows you to buy, sell, and learn about cryptocurrencies. |
| Robinhood | Venmo is a payment processor that also offers crypto. Venmo allows users to purchase crypto in amounts as low as $1.00 from the app. However, at the time of this writing, they only offer four options: Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. Yes, you can buy crypto this way, and they make it easy. However, if you choose to buy this way, you won’t get access to the same helpful information and data offered by exchanges like Binance, Crypto.com, etc. |
| SoFi | SoFi is a personal finance company that offers personal loans and online brokerage services. |
| TradeStation | TradeStation provides online trading and brokerage services. |
| Venmo | Robinhood only offers a small selection of coins and tokens to protect its investors from the dangers of trading cryptos. |
| Webull | Webull is a commission-free trading platform. |
To buy and sell, you’ll need to link a financial account, such as a checking or savings account, PayPal, or debit card. In addition, you’ll need to verify your email, phone number, and identity.
Related articles: Learn more about financial investigations, review our stock market research tools and an overview of traditional online investing sites.
How People Buy Crypto
Once you’ve reviewed the list of cryptocurrencies, signed up with an online exchange, and verified your identity, it’s time to set up payment options. The larger exchanges allow you to connect directly to a bank account. At the same time, others will enable you to use online payment processors like PayPal. In addition, you can do a wire transfer, but that is usually the most expensive method. Also, some crypto sellers allow you to use gift cards.
Transaction Fees
All of the exchanges will charge some transaction fee. The following is a list of typical transaction fees for the most popular exchanges (Note: These fees may change. Check the trading platform for current fees):
| Exchange Name | Transaction Fee |
| Binance | 0.1% |
| Coinbase | ~1.50% |
| Coinbase Pro | 0.50% |
| Crypto.com | 0.10% to 0.16% |
| eToro | No trading fees |
| Gemini | The greater of either a flat fee ($0.99, $1.49, $1.99, $2.99) or 1.49% |
| Kraken | 0.16% to 0.26% |
| Robinhood | No trading fees |
Note: Transaction fees may change at any time. In addition, many trading platforms charge a variable fee that is determined when the order is placed.
Industry Associations
At times, it may be helpful to review the information, research, and data available through industry associations. However, the industry is still in its early phase of development, and several associations and alliances have already been established:
- Blockchain Association – The association educates policymakers on the value of blockchain technology.
- PoS Alliance – The Proof-of-Stake Alliance educates lawmakers on the importance and benefits of proof-of-stake mechanisms.
Key Cryptocurrency Insights for Private Investigators: Terms & Definitions
Private investigators must be able to “speak the language” effectively in any investigation. Here is a list of key terms and definitions to help you “talk the talk.”
- Atlcoins – Altcoins are just alternatives to Bitcoin.
- Blockchain—At its most basic level, a blockchain is like a ledger. It contains a list of transactions every time someone buys or sells a token or coin.
- DAO – Decentralized Autonomous Organization. DAOs are a way to organize people and share ownership using smart contracts.
- DeFi – DeFi means Decentralized Finance. It means it is a blockchain form of finance that doesn’t rely on traditional banks.
- Fork – A fork happens whenever a community changes the underlying rules. For example, Cardano recently launched a major update, the Vasil Hard Fork.
- Gas – Gas is the fee to conduct a transaction. Also, gas refers to the fee to execute a smart contract on the blockchain.
- Memecoins – Memecoins generally refer to cryptocurrencies that originate from internet memes. Examples include Dogecoin and Shiba Inu.
- Mining – The term mining is usually associated with Bitcoin. Bitcoin mining is creating a new bitcoin by solving a puzzle.
- NFT – NFT stands for Non-Fungible Token. Each NFT is unique and can be used to authenticate ownership of digital assets.
- Proof of Stake (PoS) – Uses randomly selected validators to validate transactions on a blockchain. The process uses specific amounts of cryptocurrency as collateral. This process is called “staking.”
- Proof of Work (PoW) – A consensus mechanism older blockchains use to verify that the transactions are legit.
- Smart Contract – Smart contracts are programs that automate the execution of an agreement.
- Stablecoin –
- Staking – Staking is a method of holding certain cryptocurrencies to earn rewards. For example, Tezos, Algorand, Cosmos, and Ethereum pay up to 5% rewards. However, unlike interest earned from a bank savings account, it pays out much more frequently—sometimes, daily or every few days. Also, you can see the interest accruing in real-time (something I like).
- Token – In general, all cryptocurrencies are tokens. However, the word token has evolved to mean a digital asset that runs on top of the blockchain of another crypto.
- Wallet – A wallet is a secure place to store private keys. Wallets can be physical devices, using something called a Ledger. Or, they can be a mobile app. For example, Coinbase offers wallets within its platform. Customers can use them as an added layer of security to help protect their currencies.
Common Scams and Schemes
As a private investigator, your customers may hire you to investigate cases involving online scams or schemes. Here’s an overview of some of the most common crimes.
- Phishing Scams – Phishing scams for crypto begin with an email that appears to be from an online exchange (e.g., CoinBase, Binance, etc.). The email usually looks legitimate and may even contain the correct logo and some of the disclaimer language. However, the links usually lead to illegitimate or fake websites. The goal is to trick you into sharing your login credentials or personal information.
- Fake Websites – Scammers use fake websites to lure unsuspecting people into giving up their personal information. Often, this scam originates as an email that appears to be from a legitimate site. However, the links in the email lead to a fake website. Often, the site looks very similar to the true website. Then, when you try to log in, you give away your credentials to the thief.
- Ransomware Attacks – Also known as cyber extortion, ransomware attacks occur when thieves take control of your computer or mobile device or threaten to expose your personal information. Usually, they demand a certain amount of money, often specifying that it must be paid in cryptocurrency.
Important Tips to Keep Your Money Safe
Following is a list of tips and reminders for potential investors.
The cryptocurrency market is volatile and very difficult to predict. The market does not follow the same investment principles as the stock market.
It involves complicated technologies that are difficult for the average user to understand. Also, due to the relatively immature age of the crypto market and the sometimes irrational behavior associated with those who invest in it, it is quite difficult to tie the crypto’s price or performance directly to the company’s value or performance. For example, the price of Dogecoin was manipulated using online news stories, social media, and discussion forum posts. The mere existence of “meme coins” indicates that prices are easy to manipulate and not always based on reality. Here is some general advice should you choose to invest:
- Choose a reputable exchange. Stick with the most well-known exchanges like CoinBase, and remember, the biggest isn’t always the best.
- After you join an exchange, be sure to activate all of the safeguards available through the exchange, like multi-factor authentication, alerts, vaults, etc. Surely, these may seem like a nuisance during the setup process, but they are an important step in securing your account. Unfortunately, hackers and thieves are constantly trying to steal money from exchanges. In most cases, they target users who don’t take the time to set up these extra precautions.
- Don’t click on email links, even if they appear from the exchange. Always visit the site’s login page, verify the URL, and log in using a strong username and password. In addition, set up multifactor authentication. For example, Google Authenticator will send a random number to an app on your phone. Then, you must enter the number to log in.
- Set up a wallet to add an extra layer of security. Wallets can be set up to require multiple people to approve transfers. This will help keep your money safe.
- First, before you jump in and buy a particular currency or token, do your research. Read through the overview provided by the exchange. Then, look for articles that directly cover crypto (pay attention to the source). Then, ask questions like, “Is the company providing the information from a reputable company like Motley Fool, Forbes, US News, or another well-known publication?
- Take the time to understand the underlying technology (if it exists). The more you understand what you’re buying and how it works, the greater your confidence in the potential for the value to increase.
- Invest in small amounts. Never put in more than you can afford to lose.
Taxes and Financial Statements
Most types of crypto transactions are taxable events. However, each type may have its own set of rules and exceptions. You must report the transactions on your tax return if you sell, convert, spend, earn, or stake crypto. Thankfully, many exchanges make tax reporting easy. For example, Coinbase has a simple tax report generator.
Please comment below if you have any questions about these cryptocurrency insights for private investigators.
Also, learn more about other types of financial investigations.