Monday, 21 November 2016

How to Identify Bitcoin Scam Scheme

I really need to do this because the numbers of bitcoin scammer out there are growing day by day to reap investors of their hard earn money, all they do is disappear with the deposited bitcoin and the next thing is to create a new site with mouth watering investment returns after gathering enough bitcoin yet they will still disappear.
Identify Bitcoin Scam Scheme

So before I go straight to the topic, I will like to make some emphasis on what is bitcoin and how it’s affecting people’s life today.

What is Bitcoin?

Bitcoin according to Wikipedia is a cryptocurrency and a payment system saved in an account called Wallet from trusted wallet providing companies like blockchain, bitx, and others. The word cryptocurrency means a digital currency in which encryption (secure) techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank. Actually, there are more than 710 cryptocurriencies available for trade in online market, but bitcoin is the most popular.

Bitcoin was first introduced on 31 October 2008 by a group of programmers, under the name of Satoshi Nakamoto. Just like A Dollar to 100 Cent, A Naira to 100 Kobo, and A Pound to 100 Pence etc. Bitcoin also has its own subdivision called Satoshi, a Bitcoin is 100,000,000 Satoshi in 8th decimal place. A Bitcoin popularly abbreviated as 1 btc is approximately 732 Dollars as at the time of making this post, that’s about 355,000 Naira.

Also Read: All Nigeria banks USSD Codes for Transfering money

How is bitcoin mining affecting people’s life today?

Actually Bitcoin had been in existence since 2008 but what really made it more popular in 2016 was an advancement in mobile technology where high tasking software can now be used without bug and also information can be passed across to a wider view within seconds.

Bitcoin has really made life easy for people in different ways like paying off bills, online shopping and also exchanging bitcoin for real cash. Bitcoin has made many rich through investment plans from various mining companies like MMM United, and others.

You make investment in these companies either by providing help, getting a downline (referral) or other business related activities for some stipulated time (days or month) and get your percentage returns.

How to know bitcoin scamming sites

Due to the geometric awareness to bitcoin, scam is also increasing day by day. Actually, there is no certain way to detect if a new site is up for scam. 

These are some of the warning signs that you might be dealing with an illegal scheme: 

  •  Promises of very high returns/interest 
  • Guarantees that you “can’t lose money” 
  • Little verifiable information on company and owners 
  • Difficulties in withdrawing your funds 
  • Social signup links with high bonuses 
  • Sense of urgency to “invest now” 

Bitcoin Phishing Scams 

Phishing scams are common in the online world. This is when a scammer creates emails, messages, login pages and/or websites that resemble a legitimate company. Once users enter their information (like login username and password) on the fake website, the scammers have access to the users’ accounts. If it is an account where Bitcoin is stored, the scammers can easily make off with the money. 

How to prevent phishing scams

  • Don’t click on suspicious emails 
  • Ensure the correct spelling of the website address 
  • Use a unique, strong password for every website account 
  • Use a reputable password management tool 
  • Enable two-factor authentication on sites that support it 
  • Report suspicious emails to your email provider (as phishing) 
  • Report suspicious websites to the respective web hosting company 

Bitcoin Wallet and Exchange Scams 

There are some websites claiming to be wallets meant to store Bitcoin. Others claim to be exchanges, where one can trade Bitcoin. Others yet claim to do both, but many of these are in fact scam sites. They simply get users to sign up and deposit Bitcoin or local currency for a while to build trust and then after a while make off with the money. 

Things to be on the lookout for: 

  • Only deal with reputable, registered companies 
  • Make sure you can verify the identity of the employees/owners 
  • See if they are mentioned in reputable local or international news publications 
  • Treat anonymous and new exchanges, apps and browser extensions with caution 

There are notable sites that research/comment on scams to keep investors save and scam free.

In case you see any site blacklisted on the site listed above and you think they are actually paying you, wait a while they haven’t gathered enough fund, but soon they will surely disappear with the deposited bitcoins. Invest wisely. 

If you notice any site or you have witnessed any scam through any site, please feel free to share them through the comment box below for general awareness.

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