Scarlett Chai of Luno Malaysia shares expert insights on how investors can protect themselves during a crypto bull run, highlighting common scam tactics, red flags, and the security measures platforms like Luno have in place.
00:00All right, moving on, we want to talk about cryptocurrency where Bitcoin is soaring, investor interest is surging, and Malaysia's crypto market is heating up, but so are the scams.
00:10As society builds around the bull run, how can Malaysians stay safe and avoid falling into digital traps?
00:16So joining us in the studio is Scarlett Chai, the country manager of Luna Malaysia to help us navigate the risk and realities of investing in crypto today.
00:23How are you, Scarlett?
00:24I'm good. Thank you for having me, Nabila.
00:26No problem. Thank you for joining me in the studio this morning.
00:28Perhaps we could start with, you know, Bitcoin has held strong above $105,000, so we're also seeing a rise in scam reports at the same time.
00:39So what's going on? If you could shed some light with us, and why do scams spike during this bull market?
00:47Yeah, I think, in fact, it has hit more than $105,000.
00:51In fact, we hit almost already RM500,000 on the Luna platform.
00:58So it's definitely an all-time high for the crypto price in Malaysia.
01:02So I think it's basically just human behavior, right, Nabila?
01:05They have this, what we call, formal feel of missing out.
01:09So I think people jump into things or hype things when, you know, it's hitting high.
01:14And for instance, in this context, it's cryptocurrency or digital assets, right?
01:18And I think people jump into it not fully understanding the topic and also the risk that comes with it as well.
01:26So I think this makes them very easy targets by scammers, especially those that promise, you know,
01:32scheme cepat kaya, you know, quick-reach schemes, and, you know, they can make quick gains during this very volatile market.
01:39So this is why we see whenever the market rises, the scam reports as well as topics about this also increases significantly.
01:47But I believe those who invest on cryptocurrency are pretty much aware of these scams beforehand,
01:51before they actually start doing it.
01:54But do you mind sharing what are some of the tactics that these scammers use to actually lure victims?
01:59And also perhaps in, specifically in Malaysia, you want to focus on Malaysia.
02:04And are there examples for, is it psychological tactics or perhaps in terms of tactical as well?
02:11Are there differences between these two?
02:12No, I think it's quite common scams for any types, whether or not an investment scam, love scam, you know, even shopping scams nowadays, I've heard.
02:23So they all use the same tactics, right?
02:25They usually lure people, firstly, based on those that do not understand the topic or, you know, the processes of it in general.
02:34Second, they also target, let's zoom into investment scams, right, in this context.
02:40They also target, scammers also target older folks with a large savings.
02:44But they're like, oh, I've heard about Bitcoin, but I have never used it before.
02:49I've never, I don't know how to approach it.
02:51Can you teach me?
02:52You know, so that is one thing.
02:54And I think the second one is, which is very, very common, is about enticing them with super lavish lifestyles.
03:01You know, posting with their supercar, posting with their big houses and say that if I can do it, you can do it as well.
03:07Those kind of testimonials.
03:08I think, and I think the last one is like a promise of guaranteed returns.
03:13I think that's the key word here, right?
03:15For investment, they promise a guaranteed returns with very, very small investments as well as the timing of it.
03:23Like, you know, usually when we think about investment, you park your money and you either wait for it to grow, like, you know, fix deposits or something like that.
03:32But they will lure you to say that you only just need to park a very small amount and you can get it, get the returns fast.
03:38And that's the key word, right?
03:40Guaranteed as well as quick returns.
03:42And I think this always happens when they tell you that, you know, you can start now.
03:47Limited time offer.
03:48If not, you will miss out this opportunity.
03:50Again, preying on human psychology.
03:52It's as if we see discounts.
03:53Yes, discounts.
03:54Exactly.
03:55When we see sales, right?
03:56I think that's human psychology that, you know, we just want to, like, get on it immediately and then all rational logic thinking, like, went out of the window already and you're just like, I cannot miss this boat.
04:06Like, I must do it now.
04:07So I think that's where, you know, scammers get you and then you deposit and then they vanish.
04:14So that's unfortunately very common tactics that they use nowadays.
04:18So what are some of the red flags that these investors should look out for or is there any telltale that screams scam that we should look out for, that we should avoid?
04:30I think the number one red flag or several red flags is the get rich quick scheme because as regulated or all investments, reputable investment platforms or even product itself, we never use the word guaranteed.
04:47So I think that is especially true.
04:51And of course, if there are any claims that say they are, you know, representing Luno, representing any sort of other platforms out there to ask you to deposit and invest in their investment packages, that is also a red flag.
05:05Because I think regulator exchanges, digital asset exchanges like Luno, we do not use any agents to facilitate buying or selling or investment on your behalf, right?
05:16So, and definitely we do not ask customers to deposit and invest via personal accounts because as licensed and regulated platforms like Luno, we are mandated to use licensed trust accounts and you can only deposit into trust accounts for any, you know, transactions purposes.
05:33So, especially the red flags, when they ask you to deposit into some random personal name account and multiple ones, that is usually a red flag already.
05:42And I think you must also remember that you, as an investor, you can only do it yourself on an investment platform.
05:50There's no agents, especially for crypto exchanges, regulated crypto exchanges like Luno.
05:54All right, I'm going to give you a situation, whether someone's just starting out or already trading actively, what are the smartest steps that they can take to actually protect themselves?
06:05And are there habits or tools that they can actually help them or every investor should adopt today?
06:10Yeah, I think the first one is that, you know, we highly recommend to use regulated digital asset exchange platform like Luno.
06:17There's a few of us that's licensed under Securities Commission.
06:19And of course, because we are licensed, we are approved by regulators and we have very strict security protocols, measures to highlight on investor protection, right?
06:32So I think that's one thing, like I mentioned earlier on, the trust account is already one security measures.
06:37And of course, there's other measures that's put in place.
06:40And I think the second thing is that how to protect yourself, right?
06:43I think you should always look up and study about the investment topics.
06:47Don't just randomly jump into it.
06:50In fact, I think that's where we understand that cryptocurrency or digital assets is a very new topic, right?
06:56And that's why we play a very active role in educating our customers as well as investors to, you know, learn about like what is Bitcoin?
07:03Very simple.
07:04What is Bitcoin 101?
07:05Why do you think you should be investing in it?
07:08What is the, like, you know, the technology behind it?
07:12Yes.
07:12And how do you navigate around the Luno app, right?
07:15So those are the kind of educational materials we have.
07:18And also the next thing is that we should definitely have good cybersecurity hygiene.
07:22Because nowadays, all investment platforms or apps, it's digital, right?
07:27Mobile.
07:27Yeah.
07:28So if you don't have good cybersecurity hygiene, you are also very prone to be, you know, hacked or, you know, assessed by some random attackers.
07:37So always don't, do not store sensitive information on emails or phones, you know, without backups.
07:43And definitely do not recycle your password by using 1, 2, 3, 4.
07:46I know some of you, you do that.
07:48You do that.
07:49It's the easiest.
07:50Yes, of course.
07:51But I think lastly, I think we should always also look for platforms with proof of reserves.
07:56Like, for instance, the Luno platform, we actually have what we call as proof of reserves because we wanted to build trust with our customers, right?
08:03We wanted to make them feel that, you know, my money, my hard-earned money is safe and I can invest on a regulated platform like Luno.
08:12That's why we have proof of reserves, which means that it shows a one-to-one match between what customer is holding as well as the company holding.
08:19So we're not saying, like, different values in actual fact, yeah.
08:24We have about three minutes left, but I just have to ask this question.
08:27Sure.
08:27Let's say scam happened and one we always ask, why can't crypto platforms just reverse scam transactions like banks do?
08:33So can you actually break down why that's not so simple in crypto world and is it technical limitation or something deeper in the blockchain's DNA?
08:41Yeah, so I think blockchain is the technology behind cryptocurrency, right?
08:44And it's designed to be immutable or decentralized, which means that there's no one central authority or body that governs the transactions in and out, right?
08:54So I think the transactions are treated like cash, like that.
08:57So once you already pass on to it and that's considered final.
09:02Now, of course, within the Luno ecosystem, if you transact, there's any issue.
09:06You can look for a licensed platform like Luno, right?
09:08But however, once you've already transacted outside of the Luno ecosystem, whether you move it elsewhere and things like that, then it will be a bit hard to trace because there's no centralized governing body that looks after, like, you know, cryptocurrency transactions.
09:22I think that's why it's very technically impossible to reverse, like, the banks.
09:26But anything you want to say, like just one short public service announcement to those traders or investors that maybe you just want to start or perhaps already actively trading?
09:36Perhaps anything you could say to them?
09:37Yes, I think treat crypto like any other asset classes that you understand, you know, it is a higher risk asset.
09:45So always manage the risk and your strategy, manage your expectations.
09:50And remember that diversifying your assets is key to the long-term wealth of your investment journey.
09:58All right.
09:58That was Scarlett Chai, the country manager of Luno Malaysia.
10:02Thanks for the advice and also the PSA.
10:03I mean, that could potentially save lives and also, I mean, it's a fast-moving pace and also with scams getting more sophisticated.
10:11And then conversations like this are crucial, actually, to keep investors informed and also safe.
10:16So hopefully this helps Malaysians navigate the crypto world with a bit more confidence and also caution.
10:22So again, thank you so much, Scarlett.
10:23And you can find this whole discussion on all of our social media platforms.
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