Crypto Scams That You Need To Look Out For!
The promise of cryptocurrencies was that their decentralized nature meant they’d be immune to the classic financial scams that have plagued the global financial system. Unfortunately, as cryptocurrencies have become more popular and accessible, we’ve seen a rise in crypto-specific scams. In this piece, we’ll discuss a few of these types of scams, so you know what to watch out for and what to avoid.
Seed Phrase Phishing
Seed phrase phishing is a scam that tricks people into sending cryptocurrency to the wrong address. It’s easy to avoid, just don’t send cryptocurrency to a random address. If you are concerned about seed phrase phishing, you can store your cryptocurrency offline.
Cryptocurrency is stored in wallets with private and public keys associated with them (this is known as encryption). The public key allows users to receive funds from others; the private key allows users to spend those funds. A seed phrase is an encrypted backup of this information—it helps ensure that if anything happens to your wallet, like losing or getting it stolen or hacked, then you can still access your funds by using the seed phrase instead of having to generate new ones again from scratch.
The fact that seeds are so important means that hackers often try their hand at getting them out of people who have them stored online somewhere where they could be vulnerable (such as an exchange’s site). By pretending they’re legitimate exchanges or software providers offering support through emails or websites designed specifically with this purpose in mind, they’ll ask potential victims questions like: “Have I helped solve any problems today?” Or “How do I make sure my password isn’t compromised?”. Then once someone opens their browser window on one of these fake sites set up by cybercriminals before entering their login credentials into what looks like something else entirely!
Off-Chain Free Giveaways
Free giveaways are a scam. They are not a real product, company, project, or investment. Free giveaways are not real giveaways.
There is no such thing as a free lunch or anything else in the crypto world. If you see an ad that says you can get something for nothing, it’s either fake or it will cost you money down the line—in one way or another.
Ponzi Schemes
If you have been online, you’ve probably come across a Ponzi scheme. But what exactly is a Ponzi scheme?
A Ponzi scheme is an illegal investment fraud that pays returns to its investors from their own money or the money paid by subsequent investors instead of from profit earned by the business’s individuals. The defining characteristic of a Ponzi scheme is that it does not generate profits for those defrauding victims and does not actually invest any of the money itself. Instead, it uses existing funds to pay off earlier investors with fake or nonexistent profits.
Rugpulls
These are scams that take advantage of the fact that people are investing in cryptocurrency. They often involve fake ICOs or exchanges and can be pulled off by a single person or a group. The scammer will start an exchange or ICO, pretend to do business with it for some time, then suddenly disappear after collecting whatever funds they can from their victims. While it may seem like a good idea at first glance—you’ll get free money!—the fact is these attacks only last for a short period of time before disappearing completely with no trace left behind except for angry investors who’ve lost their investments (and all hope) along with it.
Fake exchanges.* You might have heard of the term “Fake Exchanges” before; but what exactly does it mean? In short: It means there’s no actual exchange! The scammers either create websites that look just like other existing ones (such as Binance), use fake social media accounts which claim to belong to big-name companies like Google or Facebook but actually belong to someone else entirely (which could lead you straight into trouble because those accounts won’t exist anymore after being reported), or simply don’t send any responses back once you message them on Telegram/Slack etcetera…
Malware
Malware is a type of computer program that infects your device with malicious intent. Malware could be used to steal your personal information, like credit card numbers and passwords; it could also be used to take control over your device and use it for other purposes (like sending spam emails). If you’re not careful, malware can do a lot of damage to your computer or phone without you even knowing it’s there!
Here are some tips on how to avoid malware:
● Don’t click on suspicious links in emails or text messages. These links will likely lead you to a website hosting the malware that will infect your device.
● Update the software on all of your devices regularly—this keeps them safe from being infected with new types of malware as well as fixing any existing problems with old versions of software (like viruses).
● Use anti-virus/anti-spyware programs and keep them up-to-date; this will help protect against most types of Let’s talk. The team here at The Crypto Lawyers is very experienced at tracking down lost or stolen coins and trying to bring the scammers to justice.
● The best thing you can do right now is schedule a time to talk to us.
● Time is really of the essence here. The longer your coins are out of your possession, the harder it is to get them back.
● Use anti-virus/anti-spyware programs and keep them up-to-date; this will help protect against most types of attacks from hackers trying to get access to our devices through security holes in these programs.* Be careful what kind of websites you visit—if something looks too good to be true then it probably isn’t true!
What you can do?
If you suspect a scam, report it to the authorities and to the website that is hosting the scam. If you have been scammed, report it to the authorities and to the website that was hosting your funds. It’s important that we all do our part in helping law enforcement fight crypto criminals!
As long as crypto is popular, there will always be scams. By keeping up with the latest news and staying alert when using your digital assets, you can keep yourself safe from the worst of them. Just remember to use common sense, do your research and always keep an eye out for red flags!
Already been scammed? Contact us!
The best thing you can do right now is schedule a time to talk to us, and let our firm fight a case for you.
