Bitcoin Scam

The Rise of Bitcoin Scams

Tracking the Rise of Cryptocurrency Scams

There was a lull in interest in bitcoin from 2017, but by the COVID in pandemic in 2020, interest in bitcoin came roaring back. Unfortunately, bitcoin scams also rose to unprecedented levels. According to CNBC, In 2021, cybercriminals stole $14 billion in cryptocurrency and crypto-related losses jumped 79% from the previous year. More recent numbers indicate that the problem of bitcoin scams doesn’t show any signs of slowing down in the near future. The FBI has identified crypto scams as the fastest-growing type of financial cybercrime. This may lead people to ask, “Is crypto a scam?” With so many fraudulent forms of bitcoin deals, it’s easy for the casual observer to confuse fake crypto deals with legitimate digital currency opportunities. This may lead people to ask, “Is crypto a scam?” With so many fraudulent forms of bitcoin deals, it’s easy for the casual observer to confuse fake crypto deals with legitimate digital currency opportunities.

What Are the Main Signs of Bitcoin Scams?

Lack of Transparency
No license
Aggressive manner
Misleading claims
Request sensitive personal information
Stops communication once they have received their money

Legitimate companies want to establish a rapport with their customers. They don’t have any reason to hide. However, a typical bitcoin scam operates differently. Since bitcoin wallets were originally intended to be anonymous, their owners weren’t required to disclose their identity. This has aided them in their covert operations. Today, large multinational crypto exchanges do require wallet owners to provide their names and contact information when they sign up. This data is kept by the exchange in accordance with Know Your Customer (KYC) regulations and can be made available to law enforcement authorities investigating cryptocurrency crimes.

The perceived anonymity on the blockchain, however, is a double-edged sword. On the one hand, not having to disclose who you are can help you keep your information private. On the other hand, bitcoin scams can flourish on the blockchain because of the lack of transparency in bitcoin transactions.

The lack of regulation, at least at this point, on the blockchain extends to companies that operate on it. Many of them ignore the need for licenses, even if they are brokers providing financial services that require government oversight. This lack of licensing should be a red flag.

Bitcoin scams, like other types of fraud, don’t like to let people go once they have potential targets. They will keep contacting you to the point where this is annoying. Real businesses don’t operate this way.

Another sign of a bitcoin scam is misleading claims. If they are offering trading or mining services, they may insist that you’ll see double-digit returns monthly. This isn’t realistic and you shouldn’t trust anyone who makes this kind of offer.

If someone asks you for bitcoin wallet keys or codes, they may be a bitcoin scam. It may be a person you think you know on Facebook or a crypto broker. No one should ask for your codes or keys.

If you have purchased something or made a deposit in a brokerage account and never hear anything more from them, chances are they made off with your funds. You should speak to bitcoin recovery experts immediately. It’s not acceptable to simply pay and not hear back from the recipient.