Cryptocurrency is becoming increasingly popular — it works fast and knows no borders. But, unfortunately, as the popularity of cryptocurrency grows, more and more fraudsters appear around it. Therefore, it is very important to follow all precautions and protect yourself from criminals as much as possible. Since the Bitcoin cryptocurrency is the main currency in the cryptocurrency market, here are the most popular types of Bitcoin fraud (moreover, the same types of fraud can be used with altcoins).
Bitcoin pyramid scheme
In this case, you may be lured with promises of incredibly high profits with extremely low investments. The principle of a classic pyramid works here: the first investors attract more and more people, from whose investments they receive income. And, as in all such schemes, when the flow of new investors drops, the pyramid collapses. A Bitcoin pyramid scheme can be identified by several signs:
- its organizers promise very high income/interest;
- they give a guarantee that "you won't lose money";
- they rush you with the words: "you need to invest as early as possible, otherwise it will be too late";
- there is little verified information about the company and its owners;
- withdrawing funds is difficult;
- registration links with large bonuses are massively distributed across social networks.
Scams with wallets and exchanges
Here we are talking about fraudulent websites. Some pretend to be Bitcoin wallets, others — exchanges, and still others — both at once. For some time after registration they work normally in order to lull your vigilance and win your trust. You calmly deposit bitcoins or fiat, the funds in the account accumulate — and the scammers disappear with your money. How to avoid being deceived:
- work only with well-known registered companies;
- try to verify the identities of employees or owners;
- study what reputable publications and forums write about the chosen wallet/exchange;
- be cautious about anonymous and very recently opened exchanges, applications and browser extensions.
Where to find information about fraudsters
It is impossible to compile an up-to-date list of fraudsters — creating a new website is very easy, so hackers can constantly change their venues. Therefore, you need to learn to independently identify suspicious offers (as described above) and make inquiries. Fortunately, the English-speaking crypto community often (and a lot) discusses cases of fraud. Here are a few of the most popular threads where you can read about scams:
- The bad list (badbitcoin.org)
- Bitcoin Scammer List of Bitcoin Scam Sites (bitcointalk.org).
Be attentive, analyze information and don't let yourself be deceived in the cryptocurrency market.
