How to Spot Cryptocurrency Scams (Infographic)
Cryptocurrencies continue to flood news headlines, with banks and major Wall Street stock exchanges reportedly pushing to introduce crypto trading in their respective territories. This means bitcoin, which has become a multitrillion-dollar asset, and fellow cryptocurrencies aren’t going away anytime soon.
They will continue to be around in the hopes of introducing a system where people can enter into financial transactions without actually using cash. Thus, there’s always the question of “Is it a good time to buy bitcoin?”.
Unfortunately, this may present a new opportunity for ill-intentioned individuals and organizations to continue victimizing cryptocurrency users. In fact, illegal crypto schemes are already as varied as can be. We’ve heard of news about price manipulation in bitcoin trading, where crypto markets are swarmed with fake orders that cause certain prices to soar.
What’s even more disturbing is that there are unlicensed or unregistered securities promoting these scams. They may be non-reporting companies, which means they’re not required to submit reports to the Securities and Exchange (SEC) Commission.
They prey upon investors by promising them guaranteed returns, without fully explaining the risks that come when they put their money in crypto-asset investment projects and products.
Scammers pretending to be someone else – usually someone reputable in the crypto world – are also aplenty. They put up fake accounts on social media and pretend to give away crypto coins to people who might be willing to transact with them.
The list of cryptocurrency scams is quite long – initial coin offering (ICO) fraud, fake digital wallets, phone porting, and bitcoin-stealing malware, to mention a few.
Indeed, as more and more people invest in the blockchain technology, the potential loot of hackers, fraudsters, and scammers is steadily increasing, too.
Meanwhile, cryptocurrency investors could only hope that regulators and watchdogs would be more aggressive in going after scams so that they would get more protection for their investments. Not to mention, investors could be more vigilant in looking for information about any crypto company that they’re dealing with.
Check out our featured infographic, which offers some sound advice on how you could protect yourself better from cryptocurrency scams.