KNOW ABOUT BITCOIN SCAMS YOU NEED TO BE AWARE OF

 Asthe price of bitcoin has increased substantially over the last few
years, so has the number of malicious individuals and organizations looking to
take advantage of others in the Bitcoin community. Bitcoin scams are not a new
occurrence as they have been around since the currency first gained some
popularity. Today, however, there is a broad range of bitcoin scams that are
defrauding unsuspecting users.
In thisarticle, we introduce the seven most prevalent types of scams you should be
aware of to avoid falling victim to any of them.
Bitcoin Investment Schemes
Bitcoininvestment schemes are another common type of scam in the Bitcoin economy.
Bitcoin investment schemes are somewhat similar to cloud mining scams in the
sense that they promise returns and pay out small daily returns until one day
all payments stop and the scammer runs off with users’ invested funds. Like
cloud mining scams, bitcoin investment scams are set up as Ponzi schemes.
Since these“investments” usually seem very profitable at first as daily payments are being
received by users, many users will re-invest their “returns” into the scheme to
generate more profit. Once a user tries to withdraw his or her earnings,
however, is where the trouble usually starts and before you know it, the
investment scheme stops paying and users lose their invested funds.
If youdecide to put funds into a digital currency investment service ensure that the
company providing the service is properly incorporated and run by reputable
industry professionals. Also, make sure that the investment strategy they
propose is outlined and makes sense. Most of all, anyone who guarantees high
returns in any investment service is lying as there is no certainty in the
investment world.
MLM Schemes
Bitcoinmulti-level marketing (MLM) schemes with no actual product or service that
promise high commissions for successful referrals are simply another type of
Ponzi scheme. Funds paid out to participants in the scheme are not company
profits. Instead, they are solely a share of the new money that new users that
were referred to the service are placing into the scheme.
Anymulti-level marketing scheme that does not have participants selling an actual
product or service are almost always guaranteed to be Ponzi schemes.
Fake Exchange Scams
Bitcoinexchanges are services provide users with a marketplace that allows them to
trade bitcoin for fiat currency or other cryptocurrencies. However, there have
also been instances of fake exchanges in the bitcoin economy.
Fakeexchanges swindle users by asking them to put a payment in that goes to the
purchase of bitcoin. However, the exchange does not remit anything to the user.
These exchanges usually attract customers by having lower credit card
processing fees than their competitors.
Hence, itis highly recommended to only use reputable exchanges that are regulated and
trusted by community members instead of just any site that promises users a
good price and low transaction fees.
Phishing Scams
Phishingscams involve sending out emails with the intention to steal personal
information. Bitcoin phishing scams usually involve a user receiving an email
where they are informed they won bitcoins but to collect their coins; they are
required to log onto their wallets through a link in the email body. Once this
happens, the user puts his or her wallet username and password onto the fake
wallet site and, thereby, loses access to their wallet and the bitcoin held
therein as his login information gets stolen by the scammers.
Phishingscams are very common and have also started to plague the Bitcoin community.
Always be careful when clicking on any links in emails that seem inauthentic,
especially when you are checking your emails on your phone, where it is easier
to miss the details of the actual sender.
Bitcoin Donation Scams
Unfortunately,scammers know how to leverage your emotions, whether they target greed by
offering “high investment returns” or, as in the case of donation scams,
people’s compassion for others.
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