Bitcoin Scam: The 4 Most Commonly Scam to Avoid
Get yourself familiarize with the 4 most commonly Bitcoin scam to help protect yourself and your funds so you don’t become the next victim.
Ever since the introduction of Bitcoin and Blockchain technology more than decade ago, Bitcoin’s prices has increases over the years and reaching billion of dollars in the crypto market. This has attracted the attention of investors and Bitcoin Scam as well. With scammers wanting to profit also somehow from Bitcoin, but through nefarious means. This typically involves targeting unprepared beginners (victim) who end up losing their BTC as a result.
In this guide, we will walk you through how you can familiarize yourself with the 4 most commonly Bitcoin scam to help protect yourself and your funds so you don’t become the next victim.
Fake Bitcoin Exchange Scam
Fake Bitcoin exchange scam mostly present itself as a place to exchange and trade bitcoin. What they do is pretend to be a real exchange. The exchange will claim to be a regulated and licence exchange offering 5% discount at market value. To avoid being a victim of this scam, beware of there high return promise. No investment can offer that can return. If you visit any exchange site the very first thing you want to do is make sure it’s HTTPS secured and not HTTP. If it’s just HTTP without the “s“, stay away that is a red flag.
ICO Bitcoin Scam
The word “ICO” stand for Initial Coin Offering. This coin offering is used by companies and startup to raise fund to create a new project, token or services. ICO scam use this same method tricking investor’s to believe its a genuine project. They raise full/partial funding during the ICO process, but they did not complete the entire process and were abandoned mid-way. In some cases they will managed to pass the ICO fund raising stage but fail to list on the exchanges for the necessary trading.Once you invest in the project, the fraudster disappear with your money.
Since the token is not backing with real use value, its useless. To avoid this scam, you must observe the following.
- The white paper of the project
- The team behind the project. Be sure to check their profile on social media and their contribution to their followers
- If it have a real product.
Defi Rug Pulls
A Defi Rug Pull is a Bitcoin scam where by developers abandon a project and run away with investors’ funds. Fraudster create a token and list it on a DEX, then pair it with leading cryptocurrency like Ethereum. Once investors swap their ETH for the listed token to a significant amount, the creators then withdraw everything from the DEX pool, diving the token price to zero.
Centralized exchanges audited token unlike Rug Pulls tokens on DEX such as PancakeSwap or UniSwap that allow creators list tokens for free and without audit.
To avoid this Bitcoin scam,
- Verify the team’s credibility and their social media profile
- Verify also the numbers of token holders via block explorer tool such as bscscan.com or Etherscan.io
- If the white paper is written in more than one meaning or not clear, its a red flag that is a scam.
Social Media Scam
Social media is a useful way to reach a large numbers of audience and it’s easy for fraudsters to make their messages look real and credible, sometimes hard for investors to tell the difference between fake and original.
Many investors use social media to help them with Bitcoin investment decision. While these tools can provide many benefits for investors, these same tools can make attractive targets for fraudsters.
Scammers use social media sites to hide out and use ads and offers to market their scam to Bitcoin users. If an investment promo capture your interest, research the “Investment promo” even before providing your details such as phone number and Email address.
Scammers will often pretend to be from legitimate and trustworthy sources, offering an enticing Bitcoin investment promo. To avoid this Bitcoin scam,
- The key to avoid Bitcoin investment fraud on social media sites is to do a quick research for the investment promo. If the company is promoting a deal on social media, they will update it on their homepage.
- Inspect any URL you aren’t sure about. Fraudsters are counting on you not to investigate before you invest. Protect yourself. By clicking on URL can lead you to a fake page where you will be trick to give out your details.