Expert Articles
4 Bitcoin Scams to Watch out for
Reported by buybitcoinworldwide.com
By Elaine Bennett, Editor at Bizzmark Blog
As the economy is under threat due to the coronavirus pandemic and more companies are shutting down their operations, you can see that more eager beavers are looking into their mining opportunities. Of course, some are knowledgeable enough to enter the world of cryptocurrency without any issues, but those who are new to the game might get hooked on a scam too soon. Knowing the risks is one of the key prerequisites to help increase your chances of success, and it makes all the difference to keep yourself informed and follow the trends that will shape this industry.
This, in turn, will help you make informed decisions and avoid scammers of all kinds. Mining can indeed be a lucrative earning opportunity for those who are willing and ready to invest time, effort, and money into the venture, but it can drain your savings faster than you can say “crypto” should you come across one of the following scams. Here’s what you should be aware of before you take the mining leap!
A classic among cyber threats, the possibility of a malware attack has become more prevalent even in the world of crypto mining because of the growing interest in the market and more hackers eager to tap into lucrative bitcoin accounts. Now, it’s a simple scam, but it works wonders for miners who don’t update their security software to protect their accounts and private information.
Hackers have come up with simple malware programs that drain your crypto accounts by changing the target address of your crypto exchanges and mining efforts to send the profits straight to the hacker. The “beauty” of this scheme is that most crypto transactions are irreversible precisely to make them safer and more secure for all parties involved, so even if you notice your funds missing after the deed is done, there’s nothing you can do to retrieve your funds. The lesson? Keep your security software updated and always take extra precautions.
In response to the growing demand for mining, you’ll find that more individuals and companies offer the option of cloud mining. The premise here is that you rent out the hardware of someone else who is located remotely, and you use their equipment to mine for your cryptocurrency, in exchange for a fee to have your dedicated account. However, unless you’re absolutely certain that you’ll see any profits from the final mining revenue, you risk investing in an entirely fraudulent venture.
The simplest possible solution that puts you in control of your efforts is to invest in crypto mining hardware that comes with low maintenance fees and won’t ramp up your electricity bill while you mine. Once again, instead of fishy resells and platforms claiming to offer original, operational equipment, you should go straight to the manufacturers and find a mining set that fits your needs.
The abbreviation stands for initial coin offerings (ICOs), and it’s one of the simplest, most alluring entry points for the newbie trader to join the crypto ranks. When the ICOs are legitimate, that is. Alas, as the bitcoin craze continues to grow, more fake ICOs emerge and more people seem to fall for their offers. One of the most effective ways to figure out if it’s a scam is to learn more about the development team behind the project, as looking them up on social networks gives you a clear idea of whether or not they truly exist.
Finally, do some of your own research and see if the model of that particular ICO seems valid, because many of the fake ICOs will publish incomplete and vague reports of their business model and projections, which is a clear red flag regarding their credibility.
If you’ve ever received a suspicious email asking you to send money to someone in distress, or from someone claiming to be from your, let’s say, bank, chances are that you’ve experienced phishing first-hand. These are some of those traditional, old-school phishing schemes that are now finding their way into the crypto world. Scammers create websites almost identical to the legitimate wallet sites you might be using, so if you receive an email sending you to a wildly similar site, it’s a phishing scam simply trying to fake their way into your actual crypto account.
Moreover, you’ll find that you should look closely at the trading sites that you visit. Many crypto miners spend their time earning their cryptocurrencies via exchanges, but it’s easy to get fooled when you’re not versed enough to recognize a fake exchange platform. So, every time you’re about to trade on a platform, make sure it’s a legitimate site.
With the right equipment at your disposal and ample knowledge of the industry, you can continue safely with your mining endeavors. What matters most is that you’re willing to continue scrutinizing every single entity you can collaborate with before you actually say yes to an exchange or any kind of collaboration. That is the only surefire way to stay on the safe end of cryptocurrency mining and to make sure that your investments work in your favor.