TRM Labs Report: Dogcoin Community Scam, Claims “Musk Donates 500 Million Dogcoins, Hits Money First and Returns Twice as Much”

Dogcoin investors eagerly await Elon Musk’s appearance on Saturday Night Live, expecting his comments to push the price of Dogcoin to new highs.

TRM Labs Report: Dogcoin Community Scam, Claims "Musk Donates 500 Million Dogcoins, Hits Money First and Returns Twice as Much"

Musk previously tweeted, “Let’s see how hot Saturday Night Live really is!” , and that “the father of dogcoin appeared on Saturday Night Live on May 8.”

However, over the weekend, dogcoin plummeted over 30%. A report claims that there is a scam in the dogcoin community.

According to a new report released by blockchain intelligence provider TRM Labs, viewers watching unofficial videos on YouTube during the Saturday Night Live telecast saw ads pushed by numerous websites claiming “Musk has donated 500 million dogcoins and is distributing them to all dogcoin holders. Anyone can receive them by visiting these sites.”

TRM Labs Report: Dogcoin Community Scam, Claims "Musk Donates 500 Million Dogcoins, Hits Money First and Returns Twice as Much"

Users were told they first had to send a certain amount of dogcoins to a designated account, and then they would be returned twice that amount.

As of Sunday, the scammer’s address had received about 9.7 million dogcoins, worth $5 million, the report said. Many of those videos have been taken down.

On Saturday, one user posted on the Dogcoin subreddit, “Don’t fall for it like I did. The site will not refund you twice the amount of dogcoins you sent them.”

TRM Labs wrote in its report, “This so-called giveaway scam is nothing new, and the FBI has found that mass marketing fraud (like the cryptocurrency giveaway scam) victimizes millions of Americans each year, resulting in hundreds of millions of dollars in losses.”

Dogecoin rose as much as 20 percent to $0.55 on Tuesday. Musk posted a poll on Twitter asking his fans if they wanted Tesla to accept dogcoin as a payment method.

As of Tuesday morning, a majority of respondents said yes, with about 20 percent saying it was a bad idea.

Edozié Izegbu, founder of crypto platform Chimera and managing director of Digital Arts, said, “Most of the value of dogcoin is speculative or driven by perception, and Musk seems to see dogcoin as a de facto cryptocurrency.”

So far this year, dogcoin is up more than 11,000 percent, while bitcoin is up 90 percent.

TRM Labs Report: Dogcoin Community Scam, Claims "Musk Donates 500 Million Dogcoins, Hits Money First and Returns Twice as Much"

IntoTheBlock’s DOGE trader indicator shows that new addresses trading dogcoins have jumped to an all-time high in less than 1 month.

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