How to Avoid Bitcoin Scams

Once you have gone through a cryptocurrency transaction, you cannot reverse it. If you have accidentally sent cryptocurrency to a third party, you cannot reverse it or stop payment. When sending cryptocurrency to a blockchain address, you must be sure about the legitimacy of any third-party services and merchants involved. Only send cryptocurrency when you trust the entities. There are different types of bitcoin scams out there for you to be wary of; know how you can avoid them.

Technical Support and Impersonation Scams

Fraudsters set up customer support phone lines and impersonate renowned companies in the finance, tech, retail, telecom, and service industries. The scam phone numbers are spammed on the internet, enticing unsuspecting victims seeking assistance. The scammers might conduct outbound calls to potential victims directly. These scammers are skilled in social engineering and making false claims to manipulate and deceive their target into giving away personal information that will be used for fraud.

• Do not give support staff or anyone else remote access to your machine to avoid giving scammers full access to your computer, online financial accounts, and digital life.
• Do not give your 2FA security codes or passwords to the staff either.
• Do not accept outbound calls asking for your sensitive personal information. Scammers can also spoof legitimate phone numbers while conducting outbound calls, so be vigilant.
• Do not send cryptocurrency to external addresses.

Giveaway Scams

Scammers are resorting to social media to carry out giveaway scams. They promote giveaways with hyperlinks to fraudulent websites. Fake accounts then respond to these posts making the scam appear legitimate. The fraudulent websites will also ask you to “verify” your address by sending cryptocurrency to the scam giveaway.

• Do not send cryptocurrency to giveaways imitating address verification.
• Do not trust giveaways and offers you come across on social media easily.
• Do not trust screenshots and images; they can be edited and altered.
• Research on any entity persuading you on social media.

Investment Scams

An investment scam is a bitcoin scam where you are asked to invest money to earn higher returns with zero financial risk; they then ask you to bring more people in. They usually need a constant flow of new people investing to make money. Ponzi and pyramid schemes are basically investment scams.

If you come across any such scam in the US, contact the Securities and Exchange Commission or the Federal Trade Commission. In the UK, contact the FCA, Financial Conduct Authority.

• Be suspicious of websites or services guaranteeing high returns or unrealistic investment opportunities.
• Send cryptocurrency to trusted third parties only. Research about the recipient.
• Notice if there are any grammatical errors in communications or on websites. Scammers often make grammatical mistakes.
• Thoroughly research the organization. Verify authenticity by checking consumer protection websites.

Extortion Scams

Scammers often use information from data breaches at other websites to make you believe that they have more data on you than they actually do. For example, they might show you one of your old passwords to affirm that their claims are legitimate.

If you have been attacked by such a scam,

• Report the email as spam.
• Scan your computer for any malware.
• Change your password if they have mentioned your current password.
• These messages can scare anyone, but they are mostly fraudulent.

Loader or Load-up Scams

Scammers frequently offer “loading” services on various platforms. They are after accounts with high limits and offer a portion of the proceeds. These scammers use stolen credit cards on manipulated accounts to conduct payment fraud. In the end, the victim is left with payment delinquencies after the legitimate cardholder discovers the fraud; the scammer often steals cryptocurrencies and submits unauthorized charges on verified payment methods.

Do not provide your passwords or security codes to third parties ever.

Telegram Scams

Scammers often resort to telegrams to target traders with fraudulent payment bots and giveaway scams.

Employment Scams

Scammers impersonate recruiters with fake job offers; they go after job hunters to steal cryptocurrency and personal information. Scammers frequently reach out to individuals who have posted their resumes on the internet and ask for payment to begin training. These alleged job offers include offer letters that appear legitimate and ask for confidential personal information.

Phishing

Phishing sites are fake websites that imitate an authentic site to trick investors into entering their login credentials or other sensitive information. These fraudulent websites are shared through a variety of methods like email, SMS text messages, social media, and search-engine ads.

• Check the website address before entering your login credentials (HTTPS is secure while HTTP is not).
• Do not click on links shared to your email; open a search engine and manually type the address or bookmark the legitimate site.

Conclusion

There are many bitcoin scams one needs to be wary of, but it can be easy if you consciously take efforts to notice red flags and steer clear of them. Regardless of how secure or reliable an exchange is believed to be, don’t test them unless you have verified their services. Lastly, don’t forget that even a popular platform is exposed to risks such as hacks. Hence, it is best to double up on your safety protocol. If an exchange offers two factor authentication then ensure you do comply with those additional security measures.