How Can You Tell A Bitcoin Scammer?
Signs of crypto scams include poorly written white papers, excessive marketing, and claims that you'll make a lot of money quickly. You can contact several federal regulatory agencies and your crypto exchange if you suspect you've been the victim of a crypto scam.
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Can You Get Scammed Through Bitcoin?**
Fraudsters are aiming to access your account details, including your crypto keys. As any crypto user knows, he who holds the key holds all the crypto. Phishing scammers often lure you into clicking on a link to a fake website, where they can then steal your account details.
Bitcoin Investment Schemes
In bitcoin investment schemes, scammers contact investors claiming to be seasoned "investment managers." As part of the scheme, the so-called investment managers claim to have made millions investing in cryptocurrency and promise their victims that they will make money with investments.
To get started, the scammers request an upfront fee. Then, instead of making money, the thieves simply steal the upfront fees. The scammers may also request personal identification information, claiming it's for transferring or depositing funds, and thus gain access to a person's cryptocurrency.
Another type of investment scam involves using fake celebrity endorsements. Scammers take real photos and impose them on fake accounts, ads or articles to make it appear as though the celebrity is promoting a large financial gain from the investment.
The sources for these claims appear to be legitimate, using reputable company names such as ABC or CBS with a professional-looking website and logos. However, the endorsement is fake.
Social Media Cryptocurrency Giveaway Scams
There are many fraudulent posts on social media outlets promising bitcoin giveaways. Some of these scams also include fake celebrity accounts promoting the giveaway to lure people in.
However, when someone clicks on the giveaway, they are taken to a fraudulent site asking for verification to receive the bitcoin.
The verification process includes making a payment to prove the account is legitimate.
The victim can lose this payment or, worse yet, click on a malicious link and have their personal information and cryptocurrency stolen.
Fake Cryptocurrency Exchanges.
Scammers may lure investors in with promises of a great cryptocurrency exchange maybe even some additional bitcoin. But in reality, there is no exchange and the investor does not know it's fake until after they lose their deposit.
Sticown crypto exchange markets such as Coinbase, Crypto.com and Cash App to avoid an unfamiliar exchange. Do some research and check industry sites for details about the exchange's reputation and legitimacy before entering any personal information.
How To Protect Bitcoin And Cryptocurrency
To protect against, cryptocurrency scams here are some of the common red flags:
• Promises for large gains or double the investment;
• Only accepting cryptocurrency as payment;
• Contractual obligations;
• Misspellings and grammatical errors in emails, social media posts or any other communication;
• Manipulation tactics, such as extortion or blackmail;
• Promises of free money;
• Fake influencers or celebrity endorsements that seem out of place;
• Minimal details about money movement and the investment; and
• Several transactions in one day.
Protect digital wallets from scammers by practicing good digital security habits such as strong passwods, using only secured connections or VPNs and choosing safe storage. There are two types of wallets: digital and hardware.
Digital wallets are hosted online and have a higher rate of getting hacked. Hardware wallets store information, such as the cryptocurrency wallet and keys, offline within a device.
Cryptocurrency is not insured by the Federal Deposit Insurance Corporation, so keeping it safe is vital. Never give wallet keys or access codes to anyone.