Thanks to its recent fame the cryptocurrency industry is attracting a lot of new names and faces, there is a whole bunch of excitement revolving around it and that can only mean one thing – there is and will be a lot of scammers lurking. This is not something new and it has become a standard thing whenever something hot and new appears.
To beat them in their own game you have to inform yourself and you have to be as clever as them. Information is always the most expensive thing in life so try and learn as much as you can and try and anticipate the things that scammers might try and exploit when it comes to cryptocurrency. Crypto by itself is pretty safe thanks to the blockchain technology it uses, but if your crypto is safe than your road to obtaining it doesn’t need to be and that is where weeks spots ripe for scammers are appearing.
Several week spots might affect you and possibly make you a scam victim, so read carefully and watch out for things like crypto exchanges, giveaway scams and pump and dump schemes that have been going around for a while now. In this article, you will be familiarized with things that might be exploited by scammers for you to be less of an easy target. Who knows maybe the more we educate you the more power we collectively have to fight bad phenomenon like this. Let’s get started!
Cryptocurrency exchanges
Now, these will be our first warning. Since crypto appeared the exchanges for it started popping around like mushrooms. The valuations for these are wildly high and are pretty much little to non-regulated which is exactly why we have so much chatter regarding them. This is of course a green lite for scammers that see these factors as a fertile ground for them to play on. Anyone out there who is already in this crypto world knows that you have to use real money, the money you earned through hard work, to by crypto. The plus side of that transaction is that you don’t have to use a bank, you do have to go through a third-party exchange. Now here is our problem. Since this is not regulated or that much-watched over, these exchanges keep closing overnight and losing all our money in that process. There are more than plenty of examples of this but we will take one as an example – Bitconnect was a very popular crypto exchange that managed to wipe out almost $2.5 billion overnight. It got smacked with a couple of accusation regarding them using a Ponzi scheme and after those, they closed up shop. They attributed their fall to the bad press that hit them as well as their platform so hard.
Giveaway scams
Our lives have now transferred to social media, and with this day in age it is considered to be normal, and why wouldn’t it be?! The interesting fact is that social media is set up to target you and your specific needs with commercials, offers and what else not. This is one more playground for scammers that can target specific people or groups to make a quick profit. As we managed to investigate Twitter, Facebook and Instagram are plagued with crypto giveaway scams. I have seen more than one of those, but being informed and educated about them (like we are trying to do with you now), I managed to steer clear of these. What you will get is a scammer or a group of them impersonating a very influential and well-known figure that will host a crypto giveaway for any reason possible. One of these scams that caught our attention was the Elon Musk impersonators that copied everything from his profile to theirs like the handle, the avatar, as well as his tweets, and decided to host a crypto giveaway as a thank you to all his fans. Come on really?! I am not saying that Elon is cheap, but this is a bit much right. And if that wasn’t a red flag by itself then your alarm should scream at you as soon as you found out that all you had to do to get “free crypto” is send him your money!
Pump and Dump schemes
Now, these are interesting and can be a bit tricky to catch on and react in time, so pay attention. Market flows on information and real-time events, right? Well, what if you could influence one of those to make the other change? These schemes are just that. For these to work scammers have to create fake accounts on social media and coordinate a huge disinformation campaign. What is the result? Well, the result is to manipulate the price of a certain cryptocurrency. See now why this one is interesting. It is not simple as previous and takes a lot of time to make it happen but when it does its $$caching$$ for scammers. We remember one scam that includes John McAfee, the guy that is behind McAfee Antivirus software. McAfee does a lot of promotion for different types of crypto out there which made him a desirable target that can be used by scammers. Now scammers create his fake account (similar to what they did with Musk) and promoted a certain cryptocurrency that they needed or wanted to pump up. They event vent to Telegram and told people to promote the said tweet and pump up that crypto even more. They were given certain instructions on when and how much of the crypto to buy and sell. So if you dig a little deeper you can see that this is a very intricate, but never the less clear pump and dump scheme made to bring quick cash to scammers.
After everything said we advise, as we always do, don’t rush into anything no matter who suggests it and check everything two or three times. Use trusted services such as Kriptomat, double-check accounts, check the satisfaction, check every little thing you can to protect yourself. Yes, there is the saying if you snooze you lose, but in this day in age when scammers have gone online and upgraded their MO, you have to pay attention to every detail. The best thing we can think of is to be suspicious of everything. We live in a world where it is every man for himself, and no one will keep you safe if you don’t watch yourself.
