More and more people are falling for cryptocurrency scams. The problem is that since most of the retail investors are not aware of the precautions which they need to take, they often fall for such scams. This also results in a lot of problems as they can lose their entire holdings as well.
The best way to avoid these scams is to gain more information about them. This ensures that whenever you are hearing about such scam, you will be able to avoid it quite easily. We will today share with you in such scams and how to avoid them.
Hardware wallet scam:
Most of the retail investors think of using the hardware wallets in order to keep their Bitcoins as well as cryptocurrency Holdings safe. However, if you’re not able to get the hardware wallet of a reputable company, you can end up losing your entire cryptocurrency holding. This is because there are built-in trojans in some of the hardware wallets. This is the reason why you have to always opt for a reputed company when it comes to buying the hardware wallet.
Cryptocurrency exchange scam:
You need to understand that not each and every cryptocurrency exchange which you come across online is legit. You have to look into the reputation of the exchange and after that, you have to take a call about indulging in trading at that exchange. Many of the exchanges do not a proper security. This can mean that they are vulnerable to hacking.
Fake ICO scam:
Many companies are coming out with ICOs these days. They are raising hundreds of thousands of dollars. However, many of them do not have a legit business model. As a result, after a while, they just disappear with the investor’s money.
Multilevel marketing:
Many multilevel marketing companies are promising earnings in Bitcoin. However, many of these companies are entirely fake. The reviews which are present are completely fake as well. This is the reason why you can easily get scammed by these companies.
Cloud mining companies:
Many of the investors who are looking to mine cryptocurrency actually use the cloud mining companies. The problem is that many of the cloud mining companies steal your cryptocurrency earnings. Either they steal a part of it or steal your entire earnings. This is the reason why you have to always ensure that you are choosing only the legit cloud mining companies. This will help you in ensuring that you are able to actually get your earnings. You have to always check the reputation of such a company and thereafter you have to take a call.
Fake Bitcoin wallets:
You need to understand that even the online wallet companies can steal your Bitcoin holdings. You need to always ensure that whenever you are using an online wallet, you have to check its reputation in advance. Only once you are able to check the reputation in advance, it will become easier for you to understand whether the wallet is legit or not. If you’re transferring your Bitcoin holdings to a fake wallet, you will never be able to access it again.
Bitcoin investment schemes:
Many companies are also running Bitcoin Ponzi schemes. They promise you astronomical returns. All you need to do is to just lend them your Bitcoin’s. However, the truth is that the returns will come only for a limited period of time. After that period of time, you will not be able to get back your Bitcoins. Neither you will be able to get the astronomical interest which they promised.
Phishing scams:
Phishing scams are common to Bitcoin and cryptocurrencies as well as net banking. You need to understand that whenever you’re logging into a website or application in order to access your Bitcoin holdings, you have to 1st verify the identity of the same and thereafter login. You have to only log in through the official websites and mobile applications.
Bitcoin donation:
Many people are trying to milk the Bitcoin holders. They create donation pages specifically asking for Bitcoin donation. You need to keep in mind that most of these donation pages are fake. Moreover, they can hack your wallet addresses as well as other details as well. This is the reason why you do not have to trust each and every Bitcoin donation page which you come across. At the same point in time, you need to keep in mind that whenever you are opting for the Bitcoin donation, it is important to always protect your identity. Only once you are able to do that, it will become easier for you to protect your Bitcoin holdings.
Fake mobile applications:
Many hackers are launching fake cryptocurrency exchange applications. Whenever you’re downloading a fake mobile application and logging into your cryptocurrency account, the hackers will be able to get your ID and password. Once the hackers are able to get your ID and password, they will swiftly move out your cryptocurrency Holdings. This is the reason why you have to only use the official applications. When you use the official applications, it will become much easier for you to access your Bitcoin holdings without any kind of fear.
Pro Tip:
In case, you are receiving an email by the cryptocurrency exchange announcing that they have launched a mobile application, it is important to verify the same from their social media accounts before using that application. In the past, there have been instances when the email lists of exchanges have been hacked and fake applications have been marketed to their email list.
Attempts are also being made by hackers to create fake cryptocurrency exchange websites. Whenever you’re logging on these fake cryptocurrency exchange websites as well, you will end up losing your cryptocurrency Holdings. This is the reason why you have to always verify the identity of the cryptocurrency websites and applications and thereafter you have to take a call.
The next time around, you are looking to secure your cryptocurrency Holdings, it is important to look into these few points. By avoiding most of these scams, you can be sure that it will become easier for you to protect your cryptocurrency Holdings. Many of the retail investors are not aware of the scams which makes them vulnerable to losing thousands of dollars to these scams. This is the reason why you have to be pretty careful of the scams and avoid them at all costs.
