How To Protect a Relative Buying Their First Cryptocurrency
How to support a family member exploring cryptocurrency for the first time while reducing their exposure to scams and avoidable losses.
Last reviewed: 1 June 2026
Cryptocurrency scams are among the most financially damaging fraud types, and they disproportionately affect first-time buyers who are navigating unfamiliar technology and terminology. Supporting a relative through their first crypto experience — without dismissing their interest — involves helping them move slowly, use reputable platforms, and recognise the tactics fraudsters use to create urgency and excitement.
Understand common crypto scams before the conversation
First-time cryptocurrency buyers are targeted by a specific set of scams that experienced users learn to recognise quickly, so front-loading this knowledge saves your relative from expensive early mistakes. Common patterns include fake investment platforms that show impressive but entirely fabricated returns on a dashboard while refusing withdrawals, 'romance' or friendship scammers who introduce a partner to crypto trading before disappearing with the funds, and impersonators posing as celebrities or customer support agents who promise to double any amount sent to them. Explaining that legitimate crypto exchanges will never contact your relative first, never guarantee returns, and never ask for funds to be sent to 'unlock' a withdrawal gives them a clear baseline to measure any new opportunity against before getting excited about it.
- Investment scams promising guaranteed high returns — no legitimate investment guarantees returns
- Fake exchanges or wallets that appear real but steal deposits
- Romance-investment scams that build a relationship before introducing a 'trading opportunity'
- Giveaway scams claiming to double any cryptocurrency sent
- Impersonation of well-known figures or official organisations endorsing an opportunity
Help them start safely
Starting on a well-established, regulated exchange rather than an unfamiliar app found through an advert or a social media message significantly reduces the risk of platform-level fraud, where the 'exchange' itself is the scam. Help your relative research an exchange's regulatory status and reputation before they deposit anything, and suggest starting with a small amount they could comfortably afford to lose while they get familiar with how buying, holding, and withdrawing actually works. Set up two-factor authentication on the exchange account immediately, and explain the difference between funds held on the exchange versus moved to a personal wallet, since understanding this distinction early prevents a lot of confusion — and vulnerability to scams — later on.
- Research regulated exchanges registered with the national financial regulator
- Start with a small amount — only what they would be comfortable losing entirely
- Use a separate email address for any crypto account
- Enable all available security settings including two-factor authentication
Establish clear decision rules for the future
Agreeing a small set of rules in advance gives your relative something to lean on in the moment when you are not there to ask, which is exactly when most bad crypto decisions get made. Useful rules include never investing money that is needed for essential bills, never sending crypto to someone who contacted them first, and always waiting twenty-four hours before acting on any 'urgent, limited-time' investment opportunity, since genuine opportunities do not disappear overnight while scams are specifically designed to create false urgency. Agreeing that any investment over a set amount gets a second opinion from you or another trusted family member before it happens adds a simple checkpoint that catches most scams before any money moves.
- Never invest more than can be afforded to lose completely
- Never act on investment advice received via social media or an unsolicited message
- If someone claims to have made large profits and wants to help you do the same, that is a red flag
- Talk to family before making any purchase over an agreed amount
Conversation script
“I want to be supportive about this — can we just go through a few things first so we can make sure you are starting on a safe footing?”
“One of the biggest rules I have read is: only put in what you would be comfortable losing completely. Cryptocurrency prices can drop very sharply.”
“If anyone ever tells you about a guaranteed return or a special opportunity that has to be done fast, that is a scam. The legitimate versions never need to rush you.”
Frequently asked questions
Should we discourage a relative from buying cryptocurrency entirely?
That depends on family circumstances. A complete prohibition is often counterproductive — it may push the decision underground. A collaborative approach focused on limiting amounts and avoiding scams is usually more effective.
How do we check whether an exchange is legitimate?
Check whether the exchange is registered with the national financial regulator. In the UK, the FCA maintains a register of cryptoasset businesses. Avoid platforms not on such a list.