5 Cryptocurrency Scams You Must Know About
Cryptocurrency has become the most widely sought currency far and wide. It allows people to make transactions without mandatory bank verifications. A bitcoin solely exists as digital entries on the database. For their specific transactions, they are stored in model blockchain wallets and keys. Moreover, they are recorded in the form of blockchains.
Mining is the process that helps generate cryptocurrency coins using high-technology computer power. Despite the advanced coding for transactions and storage, cryptocurrency scams are on the rise.
Do you want to know the kinds of scams going around? Keep reading ahead!
Phishing Scams
Scammers promote their websites by sharing their malicious links via email. The email directs you to fake websites, that mimic the original ones. Ultimately, they get access to your wallet key. Your wallet key is a unique user-specific key. It is different from a password.
Once stolen, it is really difficult to change the wallet key. Protect it by always going to the official coinbase app. This way, you can always avoid this crypto fraud called “Phishing Scam.”
Fake Websites
Fake websites and platforms are usually built to bait victims. They look almost similar to the official coinbase wallets. Impersonating genuine websites has slightly different domains. These scam websites motivate you to keep investing by:
- fake commendations,
- guaranteed returns and,
- promising massive success quickly.
No matter how original the website may look, always visit the original coinbase to avoid being dumped.
Ponzi Schemes
According to research, there are more than 500 Ponzi schemes on Ethereum. Ponzi schemes lure users into investing more and more. They do it by creating illusions of huge currency gains with little risk. These scammers pay off the older investors through the gains from the newer ones. This way, they get fresh investors.
Since there are no legitimate rules and regulations for crypto trading, this scheme goes around in cycles. Avoid these crypto frauds with these two mindful approaches.
- There is always a risk while investing in cryptocurrency
- There are “NO” guaranteed returns
Romance Scams
Dating apps are now being used creatively.
Scammers gain their victim’s trust via dating apps. It’s easier for them when the relationship is long-distance and strictly online. They gradually convince the other party to invest in virtual currencies. Soon after they receive the money, these tricksters vanish right away.
These are also known as “pig-butchering scams.” The reason is, the scammers first flatter their targets with fake bonding. And once the investor gets “fattened up”, they steal their money.
Man-in-the-Middle Attack
Public Wifi connections are the least secure. Your privacy is more prone to be invaded when used publicly. Wifi networks are easily interrupted while the fraudster is nearby. Crypto scammers steal sensitive information when you log in to your wallet accounts in public.
This man in the middle can best be blocked by VPN(Virtual Private Network). The VPN encrypts all the private data being transmitted. The hackers get blocked from your access. Hence, allowing you to have additional privacy.
Conclusion
Blockchain technology is typically used to generate cryptocurrencies. It is based on a highly complex procedure. Therefore, transactions need a two-factor authentication process. Despite having majorly encrypted privacy, no crypto website is too hard to hack.
You must always watch your wallet app for additional safety. Moreover, keep your wallet keys private. Know that no firm asks you for your login credentials
Which other techniques do you think should be used to avoid these Cryptocurrency scams?
