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How Can You Protect Yourself Against Bitcoin and Cryptocurrency Scams?

Bitcoin is the investment equivalent of Pandora’s Box — it may be both beneficial and harmful depending on where you put your money. Since its inception in 2008, Bitcoin has been a source of debate. It has fueled hundreds of rags-to-riches stories while also allowing con artists to make millions off unwary customers and investors.

For the past several days, Bitcoin prices have been hovering around $9,000, making it a tempting investment option for thousands of Indians. The broker David Green from The Investment Center says if you’re one of the hundreds of people excited about the future of cryptocurrency, you’ll want to learn everything you can about Bitcoin scams and how to avoid them:

Fake Crypto Investment Platforms

Fake Bitcoin exchanges are a serious security risk! BitKRK was the name of a South Korean fraudulent exchange that operated in 2017. While it appeared to be legitimate and promoted itself as a member of the cryptocurrency trading community, it defrauded investors and purchasers of millions of dollars before being discovered by South Korean financial officials.

All bogus cryptocurrency exchanges must be avoided. Only use reputable and well-known bitcoin exchangers. Check Bitcoin forums and subscribe to legitimate RSS feeds or notifications to stay informed about fraudulent exchanges. Alternatively, for actual investing chances, stick to reputable Bitcoin platforms.

Other Cryptocurrencies That Aren’t as Trustworthy

Following Bitcoin’s success and skyrocketing demand, a slew of new cryptocurrencies has sprung up all over the world. It is indeed difficult to keep track of each one’s authenticity and performance.

New cryptocurrencies can be less expensive, making them a more appealing investment option for most new investors. The selling point of these new currencies is that it is already too late to invest in Bitcoin and that instead, one can take advantage of the chance to invest in one of the new and emerging currencies to make more money!

That isn’t the case at all. Always keep in mind that My Big Coin was shut down after clients bought fraudulent alt currencies for $6 million.

However, it is critical to review the fundamentals of each cryptocurrency, such as its maximum supply and circulation. For example, the maximum supply of Bitcoin is exactly 21 million, with 18 million in circulation. Bitcoin is one of the world’s most valuable, trustworthy, and widely recognized cryptocurrencies.

Scams in the Mining Industry

Cloud mining enables average investors to mine cryptocurrency without having to purchase expensive gear. When you consider that you can mine cryptocurrencies like Bitcoin from the comfort of your own home without having to invest in exorbitantly cost gear, it may be quite profitable.

A few cloud mining services exist that allow customers to rent server capacity for mining cryptocurrencies at a set cost. However, as a first-time investor, how can you know which services are legitimate and which are only looking for your hard-earned cash?

False ones can be identified by their grandiose claims. They offer amazing returns on your money while failing to reveal the hidden charge that will be applied to these gains. These servers are cleverly designed to defraud unwitting investors. Genuine businesses should not be able to promise a profit.

When joining up for cloud mining servers, always be cautious. Before you go online on a shared server, consider the security of your data on your system.

Pump-and-dump plans:

It’s not unusual for fraudsters to purchase a new cryptocurrency in bulk. This temporarily raises the crypto currency’s market price and causes FOMO (fear of missing out) among other investors.

Scammers sell their shares of coins for a greater price as soon as new investors start investing in the new currency and the prices rise.

Pumping and dumping are prohibited in the stock market, but they are all too frequent in the grey area of cryptocurrencies. Choose more popular and reliable crypto alternatives like Bitcoin alone to avoid pump and dump scams.

Malware:

Before and throughout their investment, new investors don’t always grasp the ins and outs of cryptocurrencies. As a result, numerous malware programs have had the opportunity to develop. People are increasingly facing fresh and more serious risks from malware programs.

Modern software designed to target cryptocurrency users and investors can get access to the user’s online wallet balance, empty the account, and replace the user’s genuine address with the scammer’s.

Apart from upgrading your antivirus and system firewall, you should make sure you’re on a safe and reliable website that doesn’t force you to download.exe files or ask you to open suspicious attachments.