How to Avoid Cryptocurrency Scams

How to Avoid Cryptocurrency Scams

As with any industry which involves online financial transactions, scamming is rife in the cryptocurrency world. In the past week, it has been reported that over 40,000 cryptocurrency scams were made in 2020. This is largely due to the fact that cryptocurrency is now part of the permanent social conscience, and has become an important institution like online banking or gambling. There is no doubt that cryptocurrency is here to stay, unfortunately, that means so too are cryptocurrency scams. An increase of at least 75% is expected this year, just last week Vancouver police reported that over $2m was stolen through cryptocurrency scams, from various customers, in just one week.

Although fears about the legitimacy of the concept have been proven to be false, cybercriminals have spotted an opportunity to illegally make money by hoodwinking keen first-time investors. However, careful investors can make plenty of money through cryptocurrency, as long as they know what kind of scams are out there, what the signs are for spotting it, and how to avoid becoming a victim.

One of the most common cryptocurrency scams is fake websites, pretending to represent real cryptocurrency pages.The kind of pages they are imitating can range from exchange wallets, official currency ages and wallet comparison sites. The sheer number of these kinds of sites, set up to trick naive investors, cannot be understated. Most web browsers place a small padlock icon next to the address bar to indicate that a site has passed their security checks. So, if this icon isn’t present, the site will most definitely be a fake. For example, if you visit you will see this icon, so therefore you can trust it. Secondly, when attempting to visit any cryptocurrency site, especially popular ones, it’s important to double check the URL. It's always advisable to find out the exact URL from someone already reliably using it as scammers use tricks like replacing letters with numbers (I with 1 for example), which can be difficult to spot when simply clicking on a link.

It will come as no surprise that as well as fake websites, hoax mobile apps are also regularly created and launched on platforms such as Apple’s App Store and Google Play. Unfortunately, probably due to the fact that hundreds of thousands of apps are added to the per day, these platforms security checks often fail to spot them. In January this year, Trezor, one of the world's most popular cryptocurrency wallets, had to warn customers, via twitter, not to download a harmful app claiming to be developed by them. By this point, the app had already been downloaded over 1,000 times with many customers having already entered their details into it. Although both Apple and Google do make huge efforts to remove fraudulent apps from their platforms, the sheer volume of apps created everyday means they can't be trusted to stop the problem before any customers are put in danger. So, it’s important for users to take responsibility for their own online security by making sure to verify apps through official channels.

As celebrity support for cryptocurrency grows, so too does the use of their names and likenesses in scams. A few weeks ago a German cryptocurrency investor lost over $500,000 to scammers after following a link posted by a fake Elon Musk twitter account, claiming to be offering followers the chance to double the bitcoin they upload to the site. This loss of 10 bitcoin has never been recovered and authorities are refusing to help. These kinds of scams are on the rise, reports state that scammers offering giveaways have already stolen over $18m in 2021 alone, after a total of $16m in the whole of 2020. To avoid being scammed in this way, it’s important to verify social media account handles for yourself, even if they feature the “blue ticks” which are supposed to do this for us. Lastly, if an offer seems too good to be tru, it probably is.

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Note: Some of the information in samples on this website may have been impersonated or spoofed.
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How to Avoid Cryptocurrency Scams