How to spot a cryptocurrency scam

To and try and protect our readers from some of the online scams out there, we have, in the past, written blog posts on how to spot Instagram money flipping scams and online charity scams. However, the July 2020 Twitter hack exposed another area that cybercriminals are now taking advantage of – cryptocurrency.

What is a cryptocurrency?

For clarity, cryptocurrencies are a form of digital currency which can be bought with ’traditional’ currency – such as Dollars, Pounds or Yen – then traded online and exchanged for goods. They are commonly seen as a peer-to-peer versions of electronic money. Currently, there are over one thousand different cryptocurrencies, but the most popular are Bitcoin, Ethereum and Litecoin. Unlike other currency, there is no official government or corporate control over the flow and exchange of electronic currency. Instead they are exchanged using a decentralised framework called the Blockchain.

Cryptocurrency scams

The number of scams involving these currencies tripled in 2019 as hackers turn to trading websites to try and trick would-be purchasers into sending money to them.

The rise of such criminal behaviour has led to Google, Facebook, Twitter and Instagram banning cryptocurrency advertisements on their websites to try and stop it.

There are four key ways these criminals will try and get your details:

  • Imposter Websites

There’s a surprising number of fake cryptocurrency websites that have been set up to resemble original, valid startup companies. If there isn’t a small lock icon indicating security near the URL bar and no “https” in the site address, think twice before inputting any of your details or making a purchase.

  • Fake Apps

Another trick scammers often use is to get users to download fake apps on the Google Play and the Apple App Store. Although these fake apps quickly get found and removed, the apps still manage to scam users in the meantime. To spot these, check for obvious misspellings in the copy or even the name of the app? It is also worth verifying the branding, logo and colouring to make sure it looks authentic.

  • Bad Tweets and Other Social Media Updates

Malicious, impersonating bots are rampant on social media and are not to be trusted. Offers that come from Twitter, Instagram, or Facebook, are unlikely to be real, especially if there seems to be an impossible result.

If an account on these platforms asks for your cryptocurrency, it’s likely you’ll never be able to get it, or anything else you were promised, back. Even if others seem to be replying to the offer these might be bots too, so you have to be extra careful.

  • Scamming Emails

Even if it looks exactly like an email from a legitimate cryptocurrency company, take care before investing your digital currency based off an email, as the scammer could be phishing for your details.

Make sure you can verify that the email address is legitimately connected to the company and never click on a link in a message to get to a site, as this could install malware on your device.

Scammers often announce fake initial coin offerings as a way to steal substantial funds. Don’t fall for these fake email and website offers. Take your time to look over all the details carefully – it is better to be safe than sorry.

What red flags should you look for with scams in general?

As with any scam, be aware of red flags which indicate that the seller is not legitimate, these could be:

  • Unsolicited contact
  • The deal is too good to be true
  • There is a clear call to action
  • You’re asked to share personal details
  • You’re put under pressure to respond quickly
  • The organisation’s contact details are vague
  • You’re asked to keep the deal quiet

If you experience any of these, we advise that you do not go through with the transaction. Learn more about staying safe and protecting yourself in this emerging market before you start investing in cryptocurrency widely.

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