Saudi Arabia Issues Warning on Fraudulent Government Crypto Projects

The Ministry of Finance of Saudi Arabia has raised alerts against fraudulent cryptocurrency activities involving the use of the kingdom’s official emblem in publicizing tokens that are falsely related to government projects.

As reported by the Arab News, the ministry said a cryptocurrency company based in Singapore was promoting digital currencies called CryptoRiyal and SmartRiyal.

The fraudsters took to their website to boost these digital currencies, adding that both coins are linked to the Saudi Riyal, the Saudi Arabia official currency.

Also, they tried to pull victims to invest in the cryptocurrencies by using the Saudi emblem of two crossed swords and a palm tree, saying it will be used to finance critical projects, the Saudi Ministry of Finance said.

The company claimed that Its “ultimate goal” is to finance NEOM, the smart city built in the north of the kingdom, which also functions as a tourist destination.

The ministry noted in a statement that, any entity that uses the Kingdom name, national currency, or national emblem to market virtual currencies marketing is subject to legal action by the competent authorities in the country.

While highlighting that fraudsters were exploiting the ignorance of how cryptos work, Dr. Assad Rizq, a cryptocurrency expert, added that, most of the companies are not regulated. They do not own any assets; sometimes, their prospectus copied from other projects.

“They hype and pump their project, so the price goes up. Inexpert investors, afraid of missing out, jump in, which spikes the price even higher. Then, the owners sell up and make tons of money,” Dr. Assad explained.

Dr. Assad further stated that given the sector is not yet regulated, anyone can use them to try to scam unsuspecting individuals.  A lot of projects use fake names and identities like countries’ names or flags, just to lure investors. 

“[…] you have to do your homework, learn about the technology. And if you still want to invest, consider your country’s rules and regulations,” he warned.