Five Common Cryptocurrency Scams and How to Avoid Them

How do you avoid cryptocurrency scams? The easiest way is just to stay at huis and don&rsquo,t play with your hard-earned metselspecie. But if you&rsquo,re determined to invest Is There Everzwijn a Safe Time to Invest te Bitcoin or Ethereum? Is There Everzwijn a Safe Time to Invest ter Bitcoin or Ethereum? There will always be a measure of risk when “investing” te Bitcoin, Ethereum, or any other form of cryptocurrency. However, that risk can be managed. Here’s how to do it. Read More ter the somewhat risky world of cryptocurrency, there are a few common scams you should be aware of.

Spil with any scam, being caught out is going to succesnummer you hard. Wij don&rsquo,t want that. Here are five common scams, and how to avoid being caught out.

1. Shady Exchanges

The explosive popularity of Bitcoin The Current State of Cryptocurrency The Current State of Cryptocurrency It’s bot a wild rail for cryptocurrency since Bitcoin (BTC) became the very first decentralized digital currency te 2009. Read More and other altcoins has seen a giant rise ter cryptocurrency exchanges. They all want your attention, and the transaction fees that come with treating your purchases.

@Poloniex #poloniex this webpagina will be the reason why fresh Crypto Users are thinking that crypto is a scam, Built and Coded scammers

However, there aren&rsquo,t many fully trustworthy cryptocurrency exchanges. Popular exchanges have bot known to fully vanish overnight, taking all the cryptocurrency with them. At other times, you&rsquo,ll encounter utterly unhelpful customer service. Sent your Bitcoin to a Bitcoin Contant wallet? Bad luck (albeit this particular transaction punt can be stationary).

If you&rsquo,re entirely fresh to cryptocurrency, you might not have heard of Mt. Gox. This wasgoed an early cryptocurrency exchange that at one point accounted for overheen 70 procent of all Bitcoin transactions worldwide. One morning, ter February 2014, Mt. Gox suspended trading. It zometeen emerged that 850,000 Bitcoins had bot stolen (valued at $450 million at the time, overheen $Three.Five billion spil of this writing &mdash, yeah, you read that right!) overheen a period time. Some 200,000 were recovered and returned to the webpagina and some users.

The point is that trusting people ter an entirely digital world is utterly difficult, especially if you cannot audit or verify what is taking place behind the scenes.

A Brief List of Somewhat Trusted Exchanges

I&rsquo,m not one to spread FUD without suggesting you some good news: there are some excellent exchanges out there. I hold a number of altcoins, and I&rsquo,ve never had any trouble with any exchange I&rsquo,m going to list below. Of course, this is subjective. But my practices are relatively uniform with other cryptocurrency enthusiasts.

  • Coinbase: Support for Bitcoin, Ethereum, and Litecoin.
  • Losbreken: Support for Bitcoin, Ethereum, Litecoin, Monero, and other popular altcoins. Some smaller altcoins too, such spil Augur, and Stellar Lumens.
  • Bittrex: Support for almost every coin you can think of, and more you&rsquo,ve never heard of. Support can be slow, but are helpful.
  • Cryptopia: Support for a ridiculously large number of coins, also features an utterly low transaction toverfee.

This is just my individual practice. Do your due diligence before placing any amount of Bitcoin or altcoins onto an exchange.

My final peak to avoid getting burned here is do not keep your cryptocurrency stored on an exchange. Transfer those coins to an offline wallet at the end of the day &mdash, it only takes a brief amount of time to send them back to an exchange for trading. If you&rsquo,re going to indeed get into cryptocurrency, consider upgrading to a cryptocurrency hardware wallet.

Two. Pyramid and Ponzi Schemes

Ter the spring of 2018, a Mumbai-based company called OneCoin wasgoed delivering a sales pitch to a slagroom of investors. Indian financial enforcement officers raided the meeting, ultimately jailing Eighteen OneCoin representatives for operating a cryptocurrency Ponzi scheme. At the time of their hechtenis, OneCoin had already moved overheen $350 million through a payment processor.

Investors had bot duped through a combination of enthusiastic upselling, lack of skill of the technology ter vooraanzicht of them, and a lotsbestemming of positive media coverage (of both the project and thriving cryptocurrency prices).

A lotsbestemming of people lost a lotsbestemming of money. And wij like to think wij&rsquo,re clever enough to spot a scam when it is vuurlijn of us. But cryptocurrency is creating fresh scams, using vaktaal and technology most people have never heard of, let alone truly understand. Even grabbing the basics of blockchain technology and brainy contracts is difficult for the layman.

Trio. Pump and Dump

Many vooraanstaand financial experts have also dismissed cryptocurrency spil a scam. While some compare Bitcoin to other safe toevluchthaven investments, such spil gold, others believe it is merely a speculator&rsquo,s heaven, ripe for pumping and dumping.

Join my fresh pump and dump group time to make some money #[email protected] #crypto #cryptocurrency

Bitcoin has a market capitalization of overheen $70 billion at the time of writing. It would be very difficult to directly manipulate the price. But smaller altcoins are utterly vulnerable to a standard pump and dump.

Ter many ways, the thousands of smaller altcoins have taken the place of penny stocks, albeit with a technological edge. Furthermore, there are several groups dedicated to this precies practice. They hold a monthly vote to choose an altcoin with a little market capitalization, and descend.

Four. ICOs

Initial Coin Offerings (ICOs) are the IPOs of the cryptocurrency world. Cryptocurrency startups create initial coin offerings to raise substantial amounts of money. However, many of them vastly overestimate the value of their startup. Others are simply elaborate pump and dump schemes.

The Securities and Exchanges Commission (SEC) is enormously wary of ICOs. They advise that they will suspend trading te stock when:

  • There is a lack of accurate or current information about a company.
  • Questions arise concerning the accuracy of publicly available information, including press releases and media coverage.
  • There are questionable trading practices, such spil insider trading, market manipulation, and more.

Of course, this doesn&rsquo,t actually always protect potential investors from scam ICOs, spil wij witnessed earlier with OneCoin. Due to the market hysteria surrounding ICOs, and the potential for large short-term profits, many scammers are attempting to profit. Alternatively, companies announce their ICO before the technology is truly ready.


When The DAO (a decentralized autonomous organization named for the acronym) finished their 2016 ICO, raising overheen $34 million, it wasgoed considered a success. That wasgoed until some users exploited a vulnerability te the DAO code, and siphoned one-third of The DAO&rsquo,s funds Why Your Crypto Coin Is Not spil Secure spil You Think Why Your Crypto Coin Is Not spil Secure spil You Think Bitcoin resumes to succesnummer fresh highs. Cryptocurrency newcomer Ethereum menaces to explode into its own bubble. Rente ter blockchain, mining, and cryptocurrency is at an all-time high. So why are cryptocurrency enthusiasts under threat? Read More to another account. To come back the funds to the original account, the Ethereum community had to agree to a hard fork, tearing the cryptocurrency te half.

DAO is now delisted from major exchanges, and is seen spil a major factor ter the (much needed) close scrutiny of the SEC te cryptocurrency ICOs.

Excellent ICOs Are Out There

Again, I don&rsquo,t want to spread FUD without providing some truly positive ICO information.

Most recently, Filecoin raised overheen $200 million for their decentralized storage system based on blockchain technology. Filecoin had some earnestly outstanding backers, too, including Winklevoss Capital (wielded by the Winkelvoss twins), Sequoia Capital, and Andreessen Horowitz.

There are also a number of very promising ICOs on the horizon &mdash, but spil wij have just seen, it is difficult to know exactly what to trust without considerable research.

ICO Geobsedeerd

ICOs have also made the (cryptocurrency) news after both China and South Korea took steps to verbod them. The South Korean Financial Services Commission said that institutions and individuals conducting business relating to an ICO would face &ldquo,stern penalties.&rdquo,

This stir comes after the Chinese government banned all ICOs, calling them &ldquo,illegal fundraising.&rdquo, China is also worried about the power cryptocurrency gives its citizens. Decentralized anonymous currency te the form of ICOs (and other altcoins) could lightly &ldquo,disrupt their social order.&rdquo, China has previously banned Bitcoin and cryptocurrency related activity, each time causing a slump te global markets.

Five. Coin Doesn&rsquo,t Exist

Ter August, 2018, the City of London Police shut down a &ldquo,cryptocurrency business&rdquo, that wasgoed cold-calling people to sell fake digital currency. Victims were cold-called and persuaded to purchase non-existent cryptocurrencies. Nine victims came forward to the U.K. rock-hard, Act Fraud, with combined losses exceeding £,150,000.

The man who allegedly set up the scam used a central London address, te financial centre, to lend the scam authenticity.

Real investors will not cold-call you to suggest an chance, cryptocurrency or not. If you receive a call asking for your investment ter a project, note the name of the caller, the company name and address, and waterput the phone down. You next call should be to the SEC to report potential securities fraud.


A growing threat comes from social media. Vooraanstaand cryptocurrency company accounts are being impersonated on Twitter and Facebook. The scam pages directly voeling individuals, asking for investment te their project, or to buy discounted Bitcoin or Ethereum.

The addresses provided are, of course, the scammers own. Note the dual underscore ter the above photos? Both of thesis accounts are now suspended.

Is Cryptocurrency Bad?

But any burgeoning technology will attract unscrupulous individuals. Especially one that involves money, high comebacks, and an amount of anonymity for scammers.

The key to staying safe te cryptocurrency is research. There are always unfortunate individuals that take the plunge, and will fall victim to fraud. Things that seem too good to be true very likely are. Some cryptocurrency day traders do make vast amounts of money &mdash, but they know what they&rsquo,re doing. And many of them have trading, buying, and selling Bitcoin and other altcoins since the very early days of cryptocurrency.

Have you encountered any cryptocurrency scams? Did you spot it straight away? Where wasgoed the scam, and what wasgoed it? Let us know your practices below!

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I wasgoed scammed for 200 worth of ETH by – I wasgoed an absolute NOOB and did no research so deserve to lose my money truly – but i dont want anyone else to fall for the same. The token name wasgoed GMT – I received the tokens after ICO and then Two weeks straks they dissapeared (Brainy contract obviously ran out lol) so I have now 150 GMT tokens worth nothing on etherscan but my wallet shows nothing. They are zuivere scammers and most likely doing it with a number of scams using the same address – or different addresses – but dont touch it with a barge pole. If I knew then what I know now then I’d have never invested. Hindsight 20:20 eh!

Good luck to all.

I just closed my CoinBase account today when I couldn’t get a hold of ANYone that wasgoed HUMAN to find out where my 0.46 ETH disappeared to after I transfered it into my CoinBase wallet address that CB generated FOR mij. I emailed support, looked for a phone number of any zuigeling, and nothing. I closed the account and I’ve bot looking for a place, but I am thinking I’m going to skip the online wallet bull crap. There seem to be MORE scams than I wasgoed led to believe there were about some of the apps I investigated. I checked out Copay, CoinBase, Kritiseren, and about Five more online wallets and apps. Too many of the negative reviews sounded like what I just went through with CoinBase. They want your i.d., phone number, register devices, IP addresses, banking information, credit card/debit card information, and I can’t speak to a LIVE person? Eff that. I’m going to get one of those outward drive wallets until I hear about a place that has less than 5k complaints te a 6 month period. I’m not well to do, or even rich. When someone suggested crypto spil an investment but I see all of thesis people being screwed overheen, that isn’t a risk I can take. It is one thing to invest, but keeping it somewhere that I can’t talk to a responsive mammal with a pulse and a good houvast on the English language instead of a bot or someone who loses NOTHING when I lose everything. Not okay. I guess I am just going to be waiting a while.


is golden one token trading te the philippines legit?

Hitbtc i am on. I bought 200 USD of DENT and some petite amount of Tron. Once the price of Dent reached like Three.Five cents my 150900 tokens were worth overheen 5000 USD. Now they vanished from account along with tron and wasgoed substituted with tether. I sent emails since the 5th still no response. I also attempted withdrawing tether 111 USD but they desired 100 USD toverfee. Also no email verification of dents withdrawal wasgoed sent to mij. This voorwaarde have bot internal from the webpagina. also when you complain te the troll opbergruimte they will shut the troll opbergruimte off so you cant proceed to voice you dissatisfaction. and many people have bot complaining about similar things happening. they keep telling its a maintenance punt.

LINDA, which happens to be my mom’s name, is it scam out of Japan. The initial suggesting is .00000002. There is a significant buyback at .000000001. Fortunately I didn’t buy for much more and wasgoed able to sell back at the Two. I only purchased 1000 of the currency and only lost 50%. Pennies. It wasgoed only because of speculation that I bought. I checked the webstek afterwards, and upon translating the webstek into English did I find it wasgoed simply a porn spinoff. Somebody is attempting to make a quick buck and more power to them for the ingenuity. Nonetheless, do not buy this particular coin! Research, research, research! Good luck.

Where did my extensive comment go?

Palm Beach Confidential should be out there spil an “avoid”. For $2500, they theoretically sell you a crypto guru for a year. While they have movies on setting up wallets that are helpful (i.e. if you paid $50 for access to thesis, you’d very likely consider it worth it). But for the surplus, you get a once a month recommendation, long holds on the phone (and no help when you eventually get a person – they are obviously paid not to know anything), no response whatsoever to customer support emails. Worse, they recommended Gemini spil a “getting te” toneelpodium (to buy Ether AND Bitcoin), and overheen Ten days, it’s bot a total fiasco. Gemini is responsible for considerable financial losses, and are now holding coin purchased with a handelsbank wire and won’t let mij withdraw it. (They said I attempted to access my account from a “different device” yesterday, which I did not, and that I had to click on a confirmation listig te an email that they DID NOT SEND Mij – repeated this process Five times, and still no help or recourse. Earlier they held on to wired (not ACH) funds for Four days and did not let mij withdraw them (you pay for the canap wire for quick access, but not at Gemini!). I suspect they make lots of money on yours while they don’t let you have access to it, but who knows? They (Gemini) may just be perplexed rather than crooks, but te any case, project on long delays and lots of missed opportunities te the market if you use them. And Coinbase couldn’t even verify a bankgebouw acct after a Two 1/Two day wait, plus they charge belachelijk commissions for buying coin. So you pay PBC a Flow of money to have them recommend utterly incompetent service providers. Plus what THEY provide is available from other outlets for maybe 2% of what they charge, so save your money and spread the word. Big egos, lots of hype, a pretty stale portfolio, bad verhoging recommendations (tho’ so far the actual trading platforms – Binance and Bittrex – have bot OK, tho’ Bittrex charges you a fortune to transfer your assets out of the exchange), and no help at all if you find yourself te a truss with one of their recommended agents. Everyone says “Only invest what you can afford to lose”, but you should AT LEAST be given the chance to lose it te the market itself, not have your money stolen before you even get there! I’m out about $3300 so far, ter less than Two weeks – less than 10% of that has anything to do with the market, but skimmers and scammers. Don’t just beware – walk away from thesis guys!

Gavin is a senior writer, focusing predominantly on security.

Related movie: My Ghetto 3204H/s $850 Monero (XMR) Equipment

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