Since 2009, when the anonymous creator behind the pseudonym Satoshi Nakamoto released the first Bitcoin, the cryptocurrency has skyrocketed to new heights, making and breaking fortunes for those who have invested in it.
The global recession brought attention to cryptocurrency, which promised a revolutionary way to trade and replace existing currencies. This technology, known as blockchain, has grown in popularity and now includes thousands of different cryptocurrencies and NFTs (non-fungible tokens). All of these digital assets are referred to as Web3, which is a concept for a new type of internet that allows exclusive ownership of digital assets and handles sales and trades of those assets.
The pandemic was a boon for Web3 products. People, aided by government bailout money, started investing heavily in the stock market, cryptocurrency and NFTs. Even GameStop, a struggling video game retailer, entered the fray with its own NFT marketplace. Unfortunately, by the end of 2022, the crypto market was not looking so rosy, highlighting the risk of investing in unregulated instruments.
The Web3 Is Going Just Great project, along with news reports, were used to estimate investor losses in cryptocurrency schemes. From 2021 to the present, the total losses recorded in the database amount to over $68 billion, even after accounting for the $8.9 billion that was recoverable. This includes 500+ events with loss estimates ranging from a small $800 to a staggering $40 billion. Loss estimates for crypto exchange bankruptcies, on the other hand, represent the amount of liabilities owed to creditors.