Crypto Scammers: 5 Ways To Avoid Them

You should never leave your wallet too close to your laptop
You should never leave your wallet too close to your laptop

Bitcoin Cryptocurrency

Ever since Bitcoin is released, controversy has not left Bitcoin’s site. It has fed hundreds of rags-to-riches stories, but at the same time, it has allowed scammers to earn millions from unsuspecting buyers and investors.

Bitcoin prices have been floating around $9,000 for quite a while making it a fruitful investment opportunity. The greatest challenge with the Bitcoin industry across the globe is rules and regulations. There is still a long way for Bitcoin to become part of the common man’s general investment portfolio.

I believe that the governments themselves face a lot of complexity in regulating Bitcoin, however, they can easily regulate the exchanges and other crypto service providers. As far as Bitcoin scams are concerned, one should always stay away from any type of eye-catching scheme. Before giving any money to a website/mobile app, know the company and its founders.

I would also suggest to never fall for mining schemes, there is no such business. There are more than 5000 verified crypto assets all around the globe. 99% of them are scammers. People are of the common mindset that “Bitcoin is very expensive, let’s invest in some cheap price coins.” Please don’t consider just price, look at the maximum supply, circulated supply, market cap, last 24 hours transaction volume, the most crucial concept, and the team behind the coin. Always be careful, to whom, and what you are investing the money for.

If you are looking to invest in Bitcoin these are the necessary precautions you should keep in mind.

1.     Fake crypto investment platforms

Fake bitcoin exchanges are a serious threat! Back in 2017, a South Korean fake exchange was operating under the name of BitKRK. While it looked legit and presented itself as a part of the crypto trading community, it looted millions of dollars from investors and buyers before it was finally caught by the South Korean financial authorities.

You must avoid all fake cryptocurrency exchanges. Keep on checking Bitcoin forums and subscribe to authentic feeds or stick to trustworthy Bitcoin platforms for genuine investment opportunities.

2.     Others less credible cryptocurrencies

After the success and skyrocketing demand of Bitcoin, tons of new cryptocurrencies have been released worldwide. This made it incredibly difficult to keep an eye on the authenticity and performance of all the cryptocurrencies.

New altcoins are usually cheaper, which makes them an eye-catching investment opportunity for rookie investors. The idea behind these new currencies is that it’s already too late to invest in bitcoin and one must seize the opportunity to invest in one of the new and upcoming coins to make more money! Well, that’s not true at all.

Here’s an example for you: My Big Coin was taken down after it sold fake alt currencies of $6 million to customers.

It is extremely crucial to take a look at the basics of any altcoin including its maximum supply and circulation. For instance, Bitcoin’s maximum supply is exactly 21 million, and 18 million are in circulation. Bitcoin is one of the most valued, trusted, and accepted cryptocurrencies across the globe.

Also Read: Why COVID-19 Is a Wake-up Call For Companies On Blockchain

3.     Mining Scammers

Cloud mining enables regular investors without expensive hardware to mine cryptocurrencies. It can indeed seem lucrative if you think that you can mine altcoins like Bitcoin sitting at home without investing in exuberantly priced hardware.

There are a few cloud mining services that offer users to rent server space at a fixed rate for mining altcoins. However, if you are a rookie investor, how would you know which services are genuine, and which ones just want your hard-earned money?

One way to identify the fake ones is by their grand promises. They promise mesmerizing returns on your investment and never mention the hidden fee that applies to these returns. These servers are smartly designed to take money from unsuspecting investors. Keep in mind that no authentic companies would guarantee you a profit.

Always be alert while signing up for cloud mining servers. Think about the security of your data stored on your system before you go online on a shared server.

4.     Pump and Dump schemes

Scammers more often than not buy a new altcoin in mass. That boosts the market price of the cryptocurrency momentarily and triggers FOMO (fear-of-missing-out) among other investors.

As soon as the rookie investors begin investing in the new coin and the prices go sky-high, the scammers sell their share of coins for a higher price.

It is illegal in the securities market but pumping and dumping are more than common in the grey zone of cryptocurrencies. Avoid pump and dump schemes by choosing more popular and stable crypto options like Bitcoin.

5.     Malware

Rookie investors don’t always comprehend the ins-and-outs of cryptocurrency before and during investing. This has given several malware programs the chance to evolve. Malware programs now pose newer and bigger threats to people.

Modern malware that targets cryptocurrency users and investors can latch onto the user accounts to retrieve the user’s online wallet balance, drain their account, and replace their authentic address with that of the scammer.

Apart from updating your antivirus and system firewall, you need to make sure that you are visiting a secure and trustworthy platform that does not prompt auto-download of .exe files or ask you to download suspicious attachments.

For more information about crypto scams and regualtions, click here