As Bitcoin Skyrockets, So Do Bitcoin Scams

As Bitcoin Skyrockets, So Do Bitcoin Scams

Chloe Seaman
May 25, 2017

Surging bitcoin prices are inspiring a new wave of scams to look out for.

Security firm ZeroFox recently noted that “Bitcoin prices reaching new highs make the currency more tempting both for scammers and for their new potential victims” and that “cybercriminals thrive on buzz.”

Bitcoin as digital money has been buzzing for years. There are numerous advantages to using bitcoin. Perhaps the most enticing use is that is places control of your money back into your own hands.

But now Bitcoin owners are lucrative targets for scammers.

We show the common Bitcoin scams happening right now and how to make sure you don’t become a victim:

Fake Bitcoin Wallets

Fake Bitcoin wallets hide malware downloads that, if clicked on, infect your computer with a virus or steal your passwords or private keys.

These scams lurk on social media, where fake Bitcoin wallets attract users to click on a URL.

How to avoid this scam: Be very cautious about any shortened URL or any URL not secured with an HTTPS connection.

Bitcoin Phishing Scams

Phishing scammers throw bait to victims typically by email or a fake web advertisement.

The idea is to trick you to into thinking they are a trusted company and lead you to a fake site. If you click on a bitcoin phishing scam, you could either get malware or lose your bitcoin through a fake sale.

How to avoid this scam: It’s good practice not to click on hyperlinks in an email or open attachments. Instead, go directly to the website. Check who sent the email, too; but keep in mind that scammers are good at spoofing email addresses.

To avoid the fake web advertisements, be aware of the site you’re visiting. And don’t click on sponsored ad content in search results. Again, go to the site directly.

Bitcoin Ponzi Scams

This type of bitcoin scam thrives on the gullibility of bitcoin users looking to acquire wealth quickly.

Bitcoin Ponzi scams make outlandish claims, like, “double your bitcoin,” or lure you in with promises of high interest rates on deposits. In the end, the scammer makes off with your stolen bitcoins.

How to avoid this scam: Ponzi sites commonly use the tactic of referral programs to help propagate a pyramid scheme. They encourage unsuspecting victims to get others to sign up via an affiliate link, then a scammer can get hundreds of people to sign up until the pyramid collapses.

If you see that a bitcoin site has a referral program, or you see a link in a social media post that looks like this: (referral link in bold); then take caution because this is a red flag.

Bitcoin Cloud Mining Scams

Cloud mining is that in which bitcoin users combine their funds together to rent bitcoin mining machines. Not all cloud mining operations are scams, but newcomers beware because there are still plenty of cloud mining scams out there.

How to avoid this scam: Much of the same advice for spotting other bitcoin scams applies to this one. Look at the url: /blogDoes it begin with HTTPS? This will let you know the site is secure. Did you come to the site via a referral link? This could be a red flag as well.

The price of bitcoin just rose to an all-time high of $2,537.16 and doesn’t look to be slowing down. As bitcoin continues to rise in popularity, so will the bitcoin scams. Whether you were an early investor of the digital currency, or you’re just looking to get involved in bitcoin, keep these tips in mind. Remember that cybercriminals are thriving right now.

Disclaimer: The above is solely intended for informational purposes and in no way constitutes legal advice or specific recommendations.