What makes a good bitcoin scam?

Bitcoin scams happen everywhere. A bitcoin scam can be broadly defined as a malicious attempt to defraud someone by giving them false information about bitcoin or a crypto-currency or by selling them fake products or services or illegal goods.

Some of the common and easy-to-spot bitcoin scams are:

Bitcoin ATM scam: This is a relatively new scam that involves the installation of fake ATM machines. It works like this:

In its simplest form, an attacker installs a malicious program on the victim’s PC which copies over to their machine all the information the victim is providing when they pay through their internet banking.

Why do people fall prey to bitcoin scams?

Not only are bitcoin scammers highly creative and cunning, they also have the good fortune of not being forced to answer for their actions.

Many people have lost their savings through bitcoin scams that defraud users of their Bitcoins. Some were told they could buy their way out of debt, but in reality they were given bogus loans that charged exorbitant interest rates and took their money and also held it for ransom, all of which is unethical and illegal.

Some victims have been convinced to buy fake bitcoins, others have been tricked into paying illegal fees and others have been scammed out of their coins by phishers who pretend to be from the legitimate bitcoin company and encourage users to part with their bitcoins.

You can avoid becoming a victim!

Keeping your guard up is vital to avoid being tricked or scammed by a potential scammers. Here are few things you need to know to recognize a possible scam and avoid falling for it.

Look out for websites that look too good to be true. Scammers can lure you in with claims of no fees, easy foreign transactions or completely free transactions. These websites typically look professional, informative and offer multiple payment options, making them look too good to be true. On some websites, a confirmation of transactions, free gift cards or a unique code is given. If these sites have links or icons at the bottom right-hand corner of the page, this could be a sign that they are a scam.

Trusted users are not obliged to send money to those who ask for it.

Conclusion

Throughout this article, there is no question that Bitcoin, and its wider cryptocurrency ecosystem is currently under attack by some of the world’s cyber criminals and there are several leading reasons for this, namely their susceptibility to security threats, complexity of conversion, rapid rise in price and lack of compliance with anti-money laundering (AML) and know your customer (KYC) regulations.

That said, what is very clear is that the security ecosystem around the Bitcoin ecosystem is also under constant scrutiny and that there is no debate regarding its legal standing.