Bitcoin Scams to Be Aware Of
Last year, more than 14 billion dollars worth of cryptocurrency was lost due to theft or scams. With crypto scammers on the rise, it's a sharp warning for anyone considering dabbling in the market.
Are you curious about cryptocurrency and want to invest, but you're worried about crypto scams? Here are some bitcoin scams to be aware of.
Phishing Crypto Scam
Phishing has been around for a long time. It's the practice of tricking someone into sharing sensitive information such as passwords or identifying information. You may receive a link in a bitcoin email scam or a link in a text from a friend.
Don't click on links in a social media post. The promise of riches is likely false. With crypto, it's a scam asking for bitcoin passwords or private keys to your wallet.
Fake Crypto ATM Providers
You always want to deal with a reputable crypto ATM provider. If you're not sure if the machine is legit, go to their website and search for the location of their ATMs. For a great example of a reputable company, check out bytefederal.com.
One recent ATM scam involved an out-of-order poster placed on a legitimate machine. When they arrived, potential users were instructed to deposit their coins using the QR code provided on the paper. In hindsight, it seems obvious, but many people sent their coins to the scammer's wallet.
Airdrop Scams
An airdrop is the promise to place tokens in your wallet as a payment or reward for performing a task for a new platform. Developers use airdrops to increase interest in a new token or platform, and scammers take advantage of these offers. These are sometimes similar to bitcoin mining scams.
These cryptocurrency scams work like this. When you receive the airdropped token, most users will sell it. When they exchange it, they provide valuable information that scammers can use to access their digital wallets.
Rug Pulls or Pump and Dumps
These two scams are similar in that they involve the promotion of a token, driving the price higher. The public buys the currency, and insiders leave or sell at the top, taking their profits.
A rug pull involves promoters who disappear with the funds, and the pump and dump are when insiders sell the tokens. They usually try to deny involvement in the scheme.
A Pig Butchering Scam
Scammers are using online dating sites to meet people. They fatten them up or gain their trust using messaging.
When the scammer tells the mark about the money they've made in crypto, the mark invests, and usually, they add more money over time. It's a long game, with the mark losing their money in the end.
Avoid Bitcoin Scams
When you take the time to learn about bitcoin scams, you will begin to understand the importance of a reputable provider. After a while, it's surprising how simple it can be to see the scammers coming.
We hope you found some great ideas on protecting yourself from scams in this article. If so, be sure to read some of the other great articles on our blog.
