How to Avoid Common Cryptocurrency Scams
The soaring popularity of crypto investing has brought many investment risks. Read our article and learn how to avoid the most common cryptocurrency scams.
Is Cryptocurrency Investing Secure?
The popularity of digital currencies, and by this we mean Bitcoin especially, has risen to dizzying heights in the last few years. If played well, this sort of investment could make you rich, no doubt.
Unfortunately, because of the risks it brings, you could just as easily lose your capital, entire life savings, mortgage, and more.
As soon as cryptocurrency investments rose to fame, so did the number of attempted frauds. Internet research is full of disturbing results that point at facts about crypto scamming. As it appears, billions were stolen through various forms of cyber theft.
Crypto defrauding reached its peak in 2021 with the amount of money stolen. The concerning circumstance is that it has continually progressed until today.
Common Crypto Scam
This article focuses on describing the most frequent methods of crypto scamming. Please pay attention to the following lines that will provide you with the basic knowledge of techniques used by cybercriminals.
In order to efficiently protect yourself from this growing threat, you have to get familiar with it first. After thoroughly researching the current trends in the crypto world, we have assembled this article to help all potential crypto investors.
Unless you inform yourself well before making any investment decisions, you could easily become the next target. Scammers are merciless and will stop at nothing when it’s about gaining profit. Get ahead of the predator by informing yourself, so you could plan your strategy successfully.
Investment Scams
First-time investors and professional traders alike must have seen flashy ads on social networks that advertise safe investing and quick wealth gain. Investment scams are most common and aren’t exclusively related only to the crypto market.
The main characteristic which could help you recognize them easier is the sudden contact by a super friendly agent. Trained boiler room agents and scamming schemes missionaries have remarkable verbal abilities. They have the capability of convincing you to invest so fast that you won’t know what hit you.
While it usually starts innocently enough and with small deposit requirements, by the time they’re done with you, you’ll be left penniless.
Phishing Scams
Phishing scams mostly relate to unwanted emails sent from suspicious addresses. However, they can be hard to spot since they appear as SMS, chat messages, and even phone calls.
The links you get usually lead to fake websites and pages that require you to enter personal information. Advertising more fake profit and supposed quick wealth, these websites are completely unrealistic and only serve to drag you into the web of lies. Also not strictly related to just crypto scamming, this is another very recurrent method.
Crypto phishing scams attempt to get you to enter your crypto wallet key. Since these transactions are basically irreversible, the scammer gains access to your funds fast and shamelessly exploits it.
By stealing the private key to your crypto wallet, the thief can quickly drain it and there’s hardly anything you could do to stop them.
Remittance/Withdrawal Scams
Withdrawal scams are another common occurrence in the crypto world. What scammers do in this case is basically fake the inability to let you withdraw your funds.
In the process, they may ask you to pay additionally to unlock the funds. So, in an attempt to get your profit, you will send more crypto to the scammer, thinking it will help the withdrawal. Unfortunately, all this does is make the fraudster richer.
Con artists such as these have many ways of convincing you to keep paying additional taxes and charges, just so you could finally withdraw your capital. They certainly don’t plan on ever letting you get your remittance, no matter how much you pay.
Romance Scams
Since these take various forms and are mostly related to social networking, we have to warn the investors who spend a lot of time surfing social apps.
Exceptionally patient, these scammers are ready to invest a lot of time into gaining the victim’s trust and affection. Once they find their target, they focus on sparking romantic interest. Manipulators take their time while building a long-distance relationship.
At some point, they will ask their victim to send them crypto for different reasons. They could pretend to be in a serious life-or-death situation or just have a hard time with finances. By using their victim’s romantic feelings, they achieve profit. When they sense they’ve gotten what they could, the scammer will just disappear without a trace.
Rug Pulls
Rug pulls are malicious acts by scammers that are possibly the hardest to detect and recognize. Usually involving DeFI and NFT projects, these can seem quite credible at first glance.
You see, the phony promote their scheme as a revolutionary new project. By doing this they boost the value of their new currency or project. The team includes other helpers that leave positive feedback to make the whole story seem even more convincing.
When less knowledgeable investor bumps into these, they quickly get the feeling they might be missing something great and profitable.
Driven by the fear of missing out (FOMO) victims quickly invest in their anxiety that others might be making a profit while they aren’t. This sends the price skyrocketing. Scammers will quickly sell the project or currency and kill the value. Soon enough, investors are left with completely worthless tokens.
Cryptojacking
Cryptojacking or otherwise famous as malicious crypto mining, had a boom back in 2017, with the mass expansion of cryptocurrencies- Bitcoin mostly.
The victim is again found usually on social networks and clicking a suspicious ad, article, extension, or app. Through these, a scammer gains access to your machine, and if they find it fitting, they will use it.
The point is to have a crypto mining malware installed on your platform that collects Bitcoin or other currencies on the hacker’s behalf. Without your knowledge, the scammers are making a profit by using your own resources.
The extracted digital currencies are sent directly to their crypto wallet. Hackers are basically making a profit without investing anything, just by illicitly using other people’s devices.
How to Avoid Crypto Scam
As you’ve seen from our article, crypto scams are such a common occurrence that the methods have become complex enough and often difficult to comprehend.
Knowledge is your greatest ally in this case. To keep it short, we’ll list some useful advice when it comes to avoiding this type of cybercrime:
- Continually educate yourself – scammers continually perfect their methods. To keep up and outsmart them, you have to keep informing yourself.
- Do not trust anything that seems too good to be true – scam agents will always approach you with suggestions for making you rich quickly. If it sounds too easy, it’s probably not true!
- Many of the people you meet online do not have noble intentions- do not be played by their unrealistic affectionate words and promises!
- Never download or directly install suspicious software – these malicious programs have the purpose to allow defrauders access to your machine and personal data.
- Use ad blockers – simple and easy to acquire, these can be a valuable ally in preventing you from clicking random yet dangerous links.
Conclusion
Crypto scamming is a whole branch of the cybercrime industry. Increasingly popular, cryptocurrencies have attracted the attention of honest investors but also users, pretenders, and hackers.
Everyone is looking to make a profit, become rich or increase their existing capital. It’s just that some use one method while others choose extreme and illegal ways.
Chances are, you have already been targeted or made contact with scammers, you might not even be aware of that. So, in order to avoid becoming their victim and keep your profit to yourself, be cautious, constantly read and do the necessary research.
About the Author/s
The New Jersey Digest is a new jersey magazine that has chronicled daily life in the Garden State for over 10 years.
