Fraud Risk Assessment: CryptoStability

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  • CryptoStability
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  • Last modified: December 7, 2017
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CryptoStability ( was launched in April 2016 providing Bitcoin investment services from the United Kingdom. The company’s legitimacy has been evaluated based on the items listed below. Every individual item has been checked for the presence of obvious red flags or warning signals. If these are present, an explanation detailing what triggered them has been included. A detailed description of the reasons to evaluate each of the included items can be found below the table.

Phantom Richesflag-iconCryptoStability is strongly dangling the prospect of wealth by stating that investing will "safeguard your financial future". More likely than not, the only financial future that is safeguarded is the one of this scammer.
Source Credibilityflag-iconThe service tries to build credibility by mentioning its "diversified staff of leading professionals across a broad spectrum of specialties" quite often.
Social Proofflag-iconCryptoStability offers an extremely high (max. 12%) referral bonus. For a real company this would equal giving away the most of the profit margin (if not more).
Guaranteed Returnflag-iconAccording to the FAQ "Crypto Stability Limited is a risk-free online investment platform"
High Return / Low Riskflag-iconWith CryptoStability you can expect to earn over 1,400% return on your investment per year according to the website, at no risk at all. This isn't just disproportionate (risk and return are always related), but also completely unsustainable.
Overly Consistent, Positive Returnsflag-iconThe investment plan returns a perfectly steady positive income percentage regardless of any external variable.
Downplaying Risksflag-iconCryptoStability doesn't just downplay risk, it even promises no risk at all.
Secretive or Complex Trading Strategyflag-icon"In addition to Bitcoin mining, we are also engaged in Bitcoin market trading." This is the most detailed description available on CryptoStability's activities. Scammers are getting increasingly lazy with empty stories such as these.
Website Availablethumb-up-iconYes
Website Registration is a newly registered website, registered in August 2015. The actual service is even a lot younger, as CryptoStability wasn't actually launched until April 2016.
Website Designflag-iconFancy design, but the terms and conditions are missing (or well hidden).
Grammar on Websitethumb-up-iconGood
Payments Optionsexclamation_warningCryptocurrency and other anonymity providing payment methods such a Payeer and Perfect Money only.
Service Disruptions & Unbusinesslike Conductflag-iconThe lack of terms and conditions (see Website Design) result an absence of any legal basis for doing business.
Contact Informationthumb-up-iconThe listed address is:

6th Floor, 25 Farringdon Street, London
EC4A 4AB, United Kingdom

The given phone number is:
+44 20 3287 5567
Verified Addressexclamation_warningThe company register confirms the address (see Contact Information), but this isn't very reliable information (see Business Registration). The location has not been visited.
Verified Ownerflag-iconThe owner's name is Raymond Wells, but this person has no online footprint.
Business Registrationexclamation_warningThe company is registered in the UK with company number 10134191 as of April 2016, but it should be noted that Companies House does not actively check addresses and names. Hence this registration doesn't hold any real value.
Financial Regulator Registrationflag-iconGiven that CryptoStability is an Investment Service, it should be regulated by the Financial Conduct Authority (FCA). There is, however, no record of the company in the public register.
Independent Auditsexclamation_warningNone
Total Flags: 13 (3 Warnings = 1 Flag)

Note that items with a warning instead of a flag indicate that these could occur at a legitimate company. For example, legitimate companies will normally try to persuade you into buying their products. Multiple warnings will, however, still trigger a flag. A description for the listed items is provided below. This list is meant to assist with identifying obvious scams, and therefore does not provide any guarantees that a company is truly legitimate.

Phantom Riches
The most common tactic used by fraudsters is called “phantom riches”. By dangling the prospect of wealth such as “big payoffs”, the scam artist tries to get you to stop thinking logically.

Using the fear of missing out, fraudsters create a false sense of urgency with statements such as “last chance” or “only so few available”. This causes people to agree hastily, before even having the opportunity to think about what they’re doing.

Source Credibility
Persuasion is more likely when the source presents itself as being credible, expert and trustworthy. Common tactics used by scammers to make themselves look legitimate include using fake websites or hacked emails and pretending to be someone they are not. Alternatively, sources can also be external with claims such as “Warren Buffet has already invested in this”.

Social Proof
Fraudsters take advantage of herd behavior by creating the illusion of consensus or social proof that the investment is legitimate with claims that “everybody is already doing it”, or referral programs in which members encourage their friends and associates to invest as well. This automatically triggers something in the head that says: “if everybody [or someone from the inner circle] wants it, it must be good”.

A business is likely to receive far more of our trust when it provides a lot of free value, because of the rule of reciprocity which causes us to tend to feel obligated to return favors after people do favors for us

Guaranteed Return
All investments carry some degree of risk, so a guaranteed profit is a clear red flag.

High Return / Low Risk
Like a guaranteed return, a high return / low risk investment opportunity also defies the common risk-return relationship. The best advice is an old one: “if it sounds too good to be true, it probably is”.

Overly Consistent, Positive Returns
Cryptocurrency markets are among the most volatile markets, hence the performance of any related product or service is also expected to fluctuate.

Downplaying Risks
The fraudster will do anything to provide a false sense of security, such as presenting some form of external risk insurance for the investment. In reality, insurance is only seldom acquired and guarantees typically lack substance. Dummy companies are often used to act as the guarantor or insurer. Other actions may include misrepresenting, or even non-disclosure of risks involved.

Secretive or Complex Trading Strategy
Even in the world of cryptocurrencies one should be skeptical about special competitive advantages without any proper disclosure, or when the information is incomprehensible or incomplete. Too often only the positive elements are accentuated.

Website Available
Considering the importance of  domains and websites in the internet age, there is almost no reason for a legit company not to have one.

Website Registration Details
Very few scam websites survive longer than one year, so domains are generally registered for just one year unless otherwise required for the specific domain. For the same reason, websites created less than one year ago should be considered suspicious.

Website Design
Amateurish, cluttered and disorganized websites can point to a scam as many scam sites use text and images from legit websites and other sources which may not work together very well.

Grammar on Website
Many scammers have limited English proficiency.

Payments Options
Even though cryptocurrency payment options are logical for a cryptocurrency company, it is also very convenient for scammers as the recipient essentially remains anonymous. The same goes for services such as Western Union and Moneygram. Hence a lack of alternative payment options should still be considered a warning signal.

Service Disruptions &  Unbusinesslike Conduct
Especially Ponzi scheme promotors will encourage participants to “roll over” their investment. These schemes are not very fond of investors cashing out, which may lead to difficulties receiving payments and a non-responsive or difficult to reach customer service.

Contact Information
Legitimate companies have very little reason not to list their contact information.

Business Verification
First, you should never hand your hard-earned money over without knowing where it is going. Second, you should do a background check to avoid handing it to a known scammer. Be weary of people without an online identity. Scammers will typically try to hide their identity or conceal their true identity to avoid being easily discovered. Especially investment services are normally subject to strict regulatory oversight, so a registration should not be hard to find.

Independent Audits
Audits certainly do not root out every instance of fraud, but auditors do have a responsibility to detect errors or fraud in the company’s financial statements.

One Response

  1. Julia Marquez April 15, 2020

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