Over 80% of the cryptocurrency market is owned by Bitcoin, whose popularity has exploded in recent years. Fraud charges have increased more than ever with those kinds of numbers, and users must always be wary of possible scams.
Despite the apparent similarity between a new Bitcoin wallet website and an established wallet, is it any good?
Let’s find out how to spot fraudulent bitcoin offers, as well as how to secure your Bitcoin wallet in this article.
Key Takeaways
• ICOs are legit ways crypto-related businesses raise funds, however, scam ICO projects are often in the mix with suggests caution when investing.
• Hodlers of crypto need to be wary of newer bitcoin wallets popping up in the market. Users must verify authenticity before buying or downloading one.
• Beware of Phishing scams are they are still popular ways of infiltrating a system with loose or weak controls.
• Cloud mining is still lucrative, but there are many scam cloud mining sites investors must be wary of.
Bitcoin Wallet Website Scams: The Most Common Scams to Watch Out For
Fraudsters use a variety of methods to try to strip you of your cryptocurrency. Although fraud methods have changed over the years due to increased security measures from legitimate wallets, some older ones are still popular to lure in cryptocurrency beginners.
ICO (Initial Coin Offerings)
ICOs are most often associated with cryptocurrencies other than Bitcoin, and they are a popular way for legitimate businesses to raise funding and for scammers to stage elaborate fraud. Here are some details.
Several new companies have created ways to store cryptocurrency or created new coins to store cryptocurrency. These initial coins will be offered by this company in exchange for fiat currency to their backers and investors.
ICOs offer investors a compelling incentive because if the cryptocurrency takes off and becomes established in the market, the ICOs could rapidly gain value.
Fraudulent firms, however, also employ similar tactics. Investors are typically fooled by hyperbolic claims that they can make huge profits within a short period – usually within a matter of weeks.
Recent trends strongly favor scam websites, which comprise the majority of the new ICO market, so it can be difficult to distinguish a legitimate ICO from one that is fraudulent. Do thorough research before investing in an ICO or avoid them altogether if you don’t want to be taken for a ride.
Fake Bitcoin Wallet Websites
New Bitcoin wallets are popping up everywhere to compete for the user base since everyone needs a wallet to trade and store cryptocurrency. New users may have a hard time distinguishing between a legitimate and fraudulent Bitcoin wallet website.
Keep in mind whether Bitcoin wallets are noticeably different from the old and established ones when choosing your perfect Bitcoin wallet. Even in a highly competitive field, there is only so much innovation there can be. The new wallet is more than likely going to be a copy of the old one, except it will be marketed differently.
Google Play Store is also exciting to Android users. Since mobile crypto transactions have become more popular, new wallets appear frequently on the Google Play Store, often with fake reviews that appear legitimate. It is not uncommon for these individuals to blatantly copy wallets such as Trezor.
Falsifying your bitcoin wallet can be aggravating. If you are buying a wallet, you should opt for checked wallets and avoid those that seem too good to be true or are very similar to older options.
Fraudulent Emails and Phishing Scams
Phishing scams attempt to obtain your personal information, usually in the form of the private key to your digital wallet, which is one of the more common types of scams outside cryptocurrency.
Most scammers use a similar-looking email address to an existing bitcoin wallet website to trick you into opening a link and inputting your private data. Airdrops, returns from investments, or info on ICOs are often included to sweeten the deal.
Slight differences between phishing emails, logos, and images can make them easy to distinguish from the real deal. Otherwise, apply logic. In a legitimate Bitcoin wallet, there is no need for their representatives to know your speed information, as they operate on a zero-knowledge model.
Cloud Mining
Fraudulent websites can replicate some legitimate cloud mining offers as well. It involves users pooling funds to purchase shared hashing equipment to mine bitcoins or another cryptocurrency collectively. An investor can make a noticeable profit if they invest in a legitimate business. You will rarely see any return on investment from scams, however.
You should always look for security red flags when examining a cloud mining website. Using HTTP, for instance, is a security red flag? What social media ads led you to this website? Is no indication provided of the type of mining pool that is used? Most likely, you are dealing with a scam if your answer to these is ‘yes’.
Make sure you trust the Bitcoin Wallet provider before investing.
For storage and trading cryptocurrencies, it’s best to use cold or hot wallets, as well as established, popular wallets when you begin Bitcoin trading.
Ensure you read carefully through privacy statements and online reviews from trusted sources. A failure to do so will result in you losing all your long-term crypto investments and your crypto wallet will be emptied.
Final Thoughts
With the boom in the crypto market and the progressive embrace of the investing populace, everyone now wants a share of the crypto market.
This development has opened up a lot of scams in form of wallets, ICO, cloud mining, etc. Clone sites are imitating the original these days while defrauding lots of unsuspecting investors. One needs to be watchful and verify every investment opportunity before putting money.
SEE ALSO: Best Hot and Cold Bitcoin Wallets
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