Scammers are increasingly exploiting both new and traditional methods to steal money using cryptocurrency. Here are some popular cryptocurrency scams.
1. Bitcoin investment schemes
Scammers approach participants in bitcoin investment schemes under the pretence of being seasoned “investment managers”
As part of the scam, the so-called investment managers make extravagant claims about their success in investing in cryptocurrencies
The scammers demand payment up front to begin
The thieves then simply steal the upfront payments rather than make money
In order to access someone’s cryptocurrency, the scammers may also ask for personal identity information under the pretence that they need it too
2. Rug pull scams
In rug pull scams, scammers “pump up” a new business, NFT, or coin to attract investors
The scammers simply vanish with the money after obtaining it
These investments’ software forbids anyone from selling bitcoin after buying it, leaving them with a worthless investment
The Squid coin scam, which took its name from the well-liked Netflix comedy Squid Game, is a common variation of this scam
To earn cryptocurrency, investors had to play
3. Romance scams
Cryptocurrency scams are not new to dating apps
These frauds involve relationships that are established gradually over time, usually through long distances and only online communication
One party gradually persuades the other to give or purchase money in cryptocurrency
Once they have your money, the dating scammer vanishes
These frauds are additionally known as “pig butchering scams”
4. Phishing scams
Phishing scams are still widely used
Scammers send emails with malicious links to a fake website in order to collect personal information, such as the private key for a bitcoin wallet
Users of digital wallets just only receive a single, unique private key, unlike passwords
It is difficult to replace a stolen private key
Since each key is exclusive to a wallet, a new wallet must be made in order to change this key
5. Man-in-the-middle attack
Scammers are able to access bitcoin users’ private information when they log in from a public place
Any data exchanged over a public network, including passwords, bitcoin wallet keys, and account information, is susceptible to interception by scammers
A hacker can obtain this private information whenever a user is logged in by employing a man-in-the-middle attack strategy
When trusted networks are nearby, Wi-Fi signals from those networks are intercepted
6. Social media cryptocurrency giveaway scams
Social media sites are flooded with fake posts that advertise bitcoin giveaways
To entice consumers, some of these scams also use fake celebrity accounts to promote the offer
However, when a user clicks on the promotion, they are transferred to a fake website that requests verification in order to send them a bitcoin
Making payment as part of the verification process demonstrates the legitimacy of the account
The victim runs the risk of losing this payment or, even worse, clicking on a malicious link that results in the theft of their personal data and bitcoin
7. Ponzi scheme
Ponzi schemes pay their older investors out of the earnings of new investors. Bitcoin will be used by cryptocurrency scammers to entice new investors
Since there are no reliable investments, the strategy is a money-making scheme that goes in circles
The promise of huge profits with little risk is the core allure of a Ponzi scheme
8. Employment offers and fraudulent employees
In order to gain access to bitcoin accounts, scammers will often pretend to be recruiters or job searchers
By using this trick, they provide a compelling job while demanding cryptocurrency in exchange for work training
Scams involving the use of remote employees exist as well
9. Fake cryptocurrency exchanges
Scammers might entice investors with claims of a fantastic cryptocurrency exchange or even extra bitcoin
However, there isn’t really an exchange, and the investor doesn’t realize it’s a scam until they’ve already lost their money
To avoid an unfamiliar exchange, stick to well-known cryptocurrency exchange marketplaces like Coinbase, Crypto.com, and Cash App
Before entering any personal information, do some research and look for information on the exchange’s repute and legitimacy on industry websites
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