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July 8, 2023 - Health Ranger - Mike Adams
20:40
Crypto sellers face HUGE FRAUD RISKS from dishonest buyers using fiat
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Time Text
You would not believe the shenanigans that I have run into and also that I have been told about by people involved in the crypto space.
Now this podcast does have I think a happy ending.
There's some good things that have happened, and this wisdom, this experience I'm sharing with you, listen up if you're going to get involved in crypto at all, because this can really save you lots and lots of hassle.
So as you may know, I've been doing a lot of interviews of people in the digital money space, thanks to my new show called Decentralize TV. And my co-host, Todd Pitner, who's been in the private digital money space for many years.
You know, he joined me, and we are co-hosting this new show.
It's really awesome, getting a ton of positive feedback.
You can watch the episodes for free at decentralized.tv, by the way.
A couple of episodes are up there, and then we're moving to do two per week now.
So starting next week, you'll see two episodes a week.
I believe the Monday episode, we'll have episodes posted Mondays and Wednesdays is the schedule now.
You know, until we go to three a week, I guess, which is probably coming.
But Local Monero is who we're interviewing on Monday's show, and man, that interview and my experience with Local Monero opened up an astonishing world to me that I had no idea.
It really was going on and that's kind of some of what I want to share with you first.
But let me share some potentially good news first.
So, you know, I was really strongly complaining about the fact that the crypto exchanges out there have been freezing my funds and canceling my accounts.
And the two most recent exchanges that did that, the first was Gemini, Gemini.com, which I had, frankly, I had recommended for a couple of years, and I had used them, no problem.
And then, as I started actually buying a lot of crypto and moving it off their platform, which I said publicly that I was going to do that, by the way, you know, I said, look, I'm taking my savings out of the fiat currency banking system.
This is my, you know, after-tax, Money, whatever I have left after paying exorbitant taxes.
This is after-tax money and some of it I had in the fiat currency banking system and different vehicles and so on.
So I sold those things and I wired money to Gemini and I bought Bitcoin with it.
And then I would transfer Bitcoin off the platform.
And believe me, Gemini makes tons of money off of just selling Bitcoin because I couldn't believe the markups, actually.
It was like, what?
You're charging me $200 just to buy this amount of Bitcoin?
But I was like, whatever.
I still think that...
I think that crypto is going to do much better long-term than the fiat currency banking system.
But, you know, who knows?
I guess it depends on the SEC and Congress and who's president and all that stuff.
So there's risk in every system.
But the point is, I was wiring some serious money over to Gemini and I was buying Bitcoin and I was sending it off-platform to my own self-custody wallets, right?
Nothing illegal.
Nothing fishy.
You know, I mean, nothing sketchy.
It's just using Gemini the way it's supposed to be used.
And they sent me an email.
I forgot the exact wording, but they're like, you're flagging this and that.
You can't use it in this way.
And they froze my ability to send Bitcoin.
So it's just like, wow.
Thank you very much for just proving that you're useless as a platform, right?
So I waited, I think, 10 days for their customer service to get back to me, and they just didn't.
Just zero customer service on Gemini, as far as I could tell.
And I went through their online form, and I also did email.
I got like a trouble ticket and everything, and they said, we're going to get on it as soon as we can, and that was 10 days ago.
What I actually ended up doing on Gemini, and this is kind of good news, and it kind of hurts my heart to say this, but I just sold all the Bitcoin that I had there.
And converted it back into fiat.
So, of course, I lost the money during buying Bitcoin and then selling Bitcoin.
So, yeah, Gemini yanked my chain a little bit on that for whatever, a few hundred dollars.
But I sold it back into fiat currency and then I was able to withdraw that fiat currency with a wire transfer back to my bank.
And they charged me, of course, $25 for the wire transfer because, you know, it's fiat currency banking systems and everything sucks.
But the good news is that worked.
So as of today, after having gone through this, Gemini has only ripped me off for a few hundred dollars and whatever pocket change I still have on there.
I don't know, a couple of different little fractions of Bitcoin that I just wanted to make sure there's still something in the account.
All right, so that's the conclusion with Gemini.
Never going to use them again, and I can't obviously recommend them at this point.
So anyway, kind of a happy ending.
I got out with some losses, but not the whole amount.
But I now have fiat currency again instead of the Bitcoin that I wanted.
So I got to start over with somebody else.
So the second platform that I had opened with was Kraken.
And I had heard that Kraken is a really great platform, that the people at Kraken, they really love liberty.
They're all in with the philosophy of self-custody, and they're true believers in the idea that cryptocurrency or private money is a big part of the answer for the future.
And I think the culture of Kraken is probably among the crypto exchanges, it's probably the most aligned with the culture of freedom and liberty and Self-reliance and all these kinds of things.
So I was pretty excited to open my account there.
And so I did.
I opened an account.
I went through their KYC. I took the selfies.
I sent them the pictures.
I gave them everything.
Here's my social.
Here's my birthmark.
Whatever.
Here's a paw print from my dog.
Whatever they needed, I sent it.
And then I wired $1,000 into Kraken.
And I've learned, like, start small.
You know, $1,000 for somebody my age is not a lot of money because, you know, if you're my age, you know, you've been working 30-plus years.
You better have more than $1,000 in savings.
So I wired $1,000.
Over to Kraken.
And I'm like, let's see if this even just works, you know?
Because I don't want to send like $10,000 in there and have something horrible happen.
Because, you know, I learned that on Gemini.
So I sent $1,000.
And the...
They accepted the wire.
I saw the transaction.
It's like, yep, we got $1,000.
It's all confirmed.
It's all verified.
And then I get this email from Kraken like a day later or a couple days later, whatever it was.
And the email said, ah, we had to close your account.
We're sending your money back and we can't tell you why.
And you can never use Kraken again.
I'm like, what the F, right?
Seriously.
I mean, I didn't even make a trade.
Didn't even make a trade.
Didn't do anything.
Except try to deposit $1,000 and they didn't even like that.
So at this point, and by the way, this does have a happy ending, so stay tuned.
At this point, I'm thinking, like, what the heck, man?
Did the deep state send out, like, super secret orders to all the crypto exchanges to, like, blacklist Mike Adams?
Which I wouldn't be surprised because I'm pretty sure that's happened...
In a lot of other contexts.
I mean, all the tech platforms, they blacklist me.
I'm not allowed to speak almost anywhere.
I'm not allowed to exist anywhere, YouTube, whatever.
And we had to sue or threaten to sue Twitter just to get my account turned back on on Twitter.
And we are suing Apple.
We're suing Facebook.
We're suing Google.
And YouTube.
And those complaints are being created right now.
We've already sent warning letters to those platforms.
And that's all in process, by the way.
So yeah, we have to...
It's crazy.
I have to spend hundreds of thousands of dollars to just have the right to speak on those platforms, just in terms of legal fees.
It's insane.
So I'm thinking, when Kraken sends me this letter, I'm thinking, oh man, are you serious?
Kraken too?
Did the deep state get to Kraken?
And it turns out the answer is no.
The answer is no.
So here's where this story turns positive.
And kind of a cool development.
So after I tweeted about this and I posted it on Telegram and I was like, this is insane.
Why is Kraken cracking down on me?
And somebody from the Kraken team...
Who handles, I guess, customer relations, saw this and they did a little digging.
They're like, yeah, what's going on?
How come Mike Adams got clobbered on Kraken?
And they actually found out that the reason for me being banned on Kraken was an error, a mistake.
And it turns out, as best I can tell, it turns out that they thought that somebody else was trying to impersonate me.
So it was kind of like, because I'm well known, and I don't know, I mean, I did send all the documents and photos and everything, but maybe they thought they were photoshopped, who knows?
Maybe they thought somebody stole my ID, and then they were pretending to be me, and then they were setting all this up in my name.
At least that's what it seems.
But the bottom line is, somebody from Kraken reached out to me And said, hey, we made a mistake.
Or, you know, our fraud team made a mistake.
And we would like to, you know, apologize for that mistake and reinstate you.
And you're not going to have this problem anymore.
And all you got to do is take another selfie and, you know, write this certain thing on it.
Which I did.
I'm fine.
I just smile for the camera.
I'm all over the camera anyway.
So I smiled and I wrote their little note and I sent it in.
And they say that they're going to turn my account back on in maybe two days, something like that.
So that's where things stand right now with Kraken.
So we're going to see if the account is turned back on.
And if it is, then I'll update you and I'll let you know.
But it's pretty cool that Kraken actually reached out because nobody else did.
Not Coinbase, not Gemini.
I'm also on another platform.
I'm not even going to say who they are.
And they canceled my ability to send Bitcoin also for some stupid reason that I don't even know.
It's like, it's crazy.
But Kraken, at least, they reached out and they're trying to resolve the issue.
And I actually spoke to their representative on the phone.
And, you know, he kind of explained what happened and how everybody's kind of hyper-vigilant about potential fraud in the crypto space, because, let's face it, there is a lot of fraud in the crypto space, and these exchanges are probably getting, you know, hack attempts and fraud attempts just constantly, every minute of every hour, I would imagine.
Because, well, crypto is irreversible, you know?
So if somebody scams a platform like Kraken and then they manage to Scam somehow like a deposit from a bank or a deposit from a debit card, let's say, and then they can convert that debit card deposit into Bitcoin and then they can send the Bitcoin off platform.
Well, if like two weeks later that whole thing turns out to be fraud, well then Kraken has to eat that loss because all the fiat currency transfers will be reversed.
But the Bitcoin can't be reversed, which is actually really a benefit of crypto.
The fact that the transactions are immutable and irreversible actually makes commerce go faster.
I talked about that in another podcast.
The point is, when there's fraudulent crypto transfers off a platform, there's no way to get that back.
And so platforms like Kraken, what they've had to do is they've had to, like, dare I say, crack down on new accounts, especially, you know, to try to stop fraudsters from rigging the system or stealing people's IDs and depositing money and sending crypto off platform and whatever.
Okay.
So, it was a fascinating conversation with my contact now at Kraken.
And he did relate that there's a tremendous amount of fraud that they have to defend against.
And frankly, that was the reason why they turned off my account.
You know, they did that out of an overabundance of caution, you could say.
It wasn't anything malicious towards me.
So that's good to know.
Although it still sucked.
But anyway, let's see if they restore it.
When I interviewed the local Monero guy, Alex is his name.
He's the co-founder of Local Monero.
I don't know his full name.
I don't even know if his first name is really Alex, and it doesn't even matter.
You know, he's probably protecting his identity as well, understandably.
You don't want to get targeted and shut down.
I don't want to say introduce me, but he pointed me in the direction of a couple of sellers on Local Monero.
And I was able to have a couple of really interesting conversations with a couple of these sellers.
Now Local Monero, in case you're wondering, it's a place where you can go and you can buy Monero from these sellers that have listings, kind of like Craigslist.
There are people selling Monero through all kinds of methods, like, send me cash in the mail, and then they'll give you Monero.
I know, sounds shady, but apparently it works, and there's actually a security bond posted by the seller, so they can't rip you off.
Anyway, you can transfer money to people using Zelle.
Or Zoom.
Or you can do wire transfers.
Or you can do cash deposits at like credit bureaus or whatever.
Or you can trade cryptocurrency for Monero.
Anyway, these sellers, they have these listings.
And what I found out from talking to these sellers is they get scammed all the time.
I mean, the risk on local Monero is not to the buyer.
The risk is to the seller.
The seller is taking the risk because the seller is accepting fiat currency, which is reversible, and yet then the seller is sending you, in this case, XMR or Monero, which is not reversible.
So these sellers are hyper, hyper paranoid.
About everything.
They're like, you got to give me KYC. I need your passport.
I need your ID. I need a note, a selfie.
You know, I need you to write an album and record it.
And the album has to be about this transaction, whatever.
They're hyper paranoid.
They demand all these things because they've been screwed so many times.
One guy demands that you get on Skype and do a video with him, like actually have a video conversation and show your ID. Like, this is me.
Yeah, I'm doing this trade.
And then he records that.
And it's like, wow, some of these sellers are doing more KYC than the exchanges are even doing, which I found rather shocking.
But of course, you can also buy with no KYC from local Monero sellers.
If you don't want to do an ID or anything, like no questions asked, yeah, there are people who will sell you that for double the price.
Or maybe 50% higher or 80% higher, whatever, double the price.
I mean, I've seen listings at double.
So if you're, I don't know, if you, for whatever reason, you don't have an ID, you can't show an ID, or you, like, I don't know, maybe a court ordered you to never buy crypto ever again in your life for some reason because you're a super crypto hacker or something.
Who knows?
You can still buy crypto without KYC if you're willing to just pay a lot more, it turns out.
Yeah, I know.
It's a trade-off, right?
So I learned that the fraud in buying and selling crypto is not so much exposing the buyers to risk, It's exposing the sellers to risk.
And see Kraken and Gemini and all these platforms, they're in the same predicament.
They're the sellers of crypto.
And yet they're accepting fiat currency from their customers.
But they're sending you irreversible crypto.
So the platforms are getting scammed all the time.
In fact, what I want to do, I want to invite Somebody from Kraken.
I'll talk to my contact there.
I want to invite somebody from Kraken to come on the show, decentralized.tv.
I want to come on the show and talk about how consumers can protect themselves from fraud, but also a little bit about how much fraud platforms have to contend with, because there is a massive amount of fraud.
Frankly, in any financial instrument, I mean, there's fraud, you know, in banks and there's fraud in dollars and there's fraud at ATMs and there's robberies at liquor stores and there's people who, you know, buy cars with fake checks and, you know, counterfeit cashier's checks, whatever.
There's fraud in everything, right?
But there's also fraud in crypto.
There's a lot of fraud in crypto, especially since people can take that Bitcoin and, you know, they can, like, whirlpool it and coin join it and run it through a bunch of wallets and basically, you know, eliminate the history of the Bitcoin with some effort and some cost.
Basically, kind of, they can launder it, you could say.
They could clean it.
And there are tools out there to do that.
It's not that the tools are bad.
There are reasons to protect your privacy, but also some criminals can, or scammers can use those tools as well to try to cover their tracks.
So what you need to know in all of this is...
Well, actually, watch your back.
Watch your back.
We're going to have to do...
Frankly, we're going to have to do a whole show about best practices for operational security.
So we're going to do an OPSEC show on decentralized.tv to talk about...
Passwords to talk about devices, talk about software wallets, upgrades, cold storage, best practices, multiple addresses, how to set up multiple addresses on Exodus, for example, how to have new portfolios there so you have different addresses to receive a Bitcoin or other privacy coins, multiple addresses that can help you maintain your privacy.
So it's too much to get into right here, but we'll do an entire show on that coming up.
So just stay tuned.
Decentralized.tv.
Thanks for listening.
Mike Adams here, the Health Ranger, also the founder of Brighteon.com.
Take care.
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