7 ways to steal your Bitcoins
The most significant feature of Bitcoin is that its owners are the only ones who have full access and bear full responsibility for their finances. No one else can force them to transfer or withdraw money against their will. There is no censorship meaning complete financial freedom. However, everything has its price. Broadly speaking, if you lose Bitcoins having transferred them by mistake to someone else’s account, or they are simply stolen, you will never be able to get them back and your funds will be irreversibly lost. This is one of the main reasons why Bitcoin is so popular among different fraudsters. Cyber criminals are becoming more skillful day-by-day elaborating tricky solutions enabling them to steal your Bitcoins. Those who have been using cryptocurrency for years are already less exposed to frauds and rarely become victims of cyber crooks. That’s why fraudsters predominantly attack new users, as they are easy to fool by promising them significant incomes incomes promptly.
It seems to be a serious problem for Bitcoin itself. Despite of the fact that such frauds are quite typical for traditional payment systems, it’s unlikely that people will stop using dollars just because someone was once deceived or lost a fortune. However, in Bitcoin’s case, the situation is pretty different, money scams and swindles are perceived as a major disadvantage of Bitcoin system itself, so that some users give up utilizing cryptocurrencies.
Later on we will tell you more about seven the most widespread Bitcoin frauds - forewarned is forearmed.
Programs – extorters
One of the most profitable ways to get away with someone’s money is to use malicious programs designed to extort money. Programs - extorters are not new, but Bitcoin made them popular among hackers due to high efficiency of its decentralized payment system. Basically, programs – extorters are viruses enciphering certain system files or the entire system of a PC and by doing so extorts money from the owner to decipher those files back. Among victims of such swindles, you may frequently find companies and organizations that cannot stop their functioning for a long time due to the type of business they are running. However, any user can become a victim of this type of scheming, especially those who are not aware of such. In the majority of cases, files enciphered by these malicious programs cannot be deciphered back by users themselves. In order to protect your data, constantly make backup copies of relevant files, do not open or download suspicious files. It also makes sense to purchase quality antivirus software to minimize risks and avoid expenses.
This type of fraud is less widespread, though sustainable number of people have become its victims. Counterfeit wallets are websites or mobile applications that look like real e-wallets (they seem real up to the moment they get to steal your coins). Usually these programs use logos of already existing well-known e-wallets to fool users. Some fake wallets were spotted even on App Store, having successfully passed verification. Because of such malicious activities real wallets lose their sound reputation, as well as Bitcoin itself. In order to avoid such situations, download e-wallets only from reliable resources, for instance, from official websites and check carefully everything you get from App Store or Play Market. If certain applications seem suspicious you may turn to recommendations of the community registered on such websites as Reddit or Bitcointalk.
Phishing is a very popular way of data theft based on social engineering. There are many ways of its implementation; usually it’s carried out through e-mails or fake web sites. Fraudsters try to make victims share with them valuable information about Bitcoins asking for logins or passwords to their online wallets. Frequently such requests come with emails looking like official letters or via domain names seeming similar to real webpages.
Pyramid investment schemes
In the said schemes, people are offered to invest their funds and invite friends to do the same thing. New investments are used to cover reimbursement commitment for the previously made investments and all this continues up to the point when the “bubble” pops and the rest of remaining investors lose their money. Pyramid investment schemes vary, but have one common thing – all of them are designed to get your coins by promising sustainable incomes within a short space of time. Such schemes are gaining popularity in various countries including India, China (Hong Kong) and Spain. Not to become a victim of a crypto pyramid, simply stay away from websites offering fantastic incomes for investing funds at a rate of 1% per day or 100% per month, etc. Avoid companies giving no clear responses on how they gain income.
One of the most vivid examples of this type of fraud is Onecoin. Users were sure that they were buying real and successfully circulating cryptocurrency, while in fact there never existed any Onecoin blockchains or Onecoin miners. In such schemes coins are sold as educational services, or users are offered to share their coins with someone in order to double the amount. Regardless of the fact that such offers sound childish; some users became victims of fake cryptocurrencies. If you are looking for an appropriate cryptocurrency to invest in, think carefully while making your choice, and don’t trust so called “developers” promising that soon the price of the coin will significantly increase. Before purchasing any type of cryptocurrency, make sure it already exists on such webpages as CryptoCompare or Coinmarketcap.
ICO or intermediate sale of tokens is a type of fund raising that lately has become extremely popular among cryptocurrency communities. The project crew launches ICO in order to sell produced coins for Bitcoins and the rest of popular cryptocurrencies as a form of payment. Though ICOs have already assisted hundreds of companies in raising millions of dollars in a matter of hours, you have to be very attentive and cautious as long as fraudsters are always on the watch.
P2P share market frauds
This variety of fraud is flourishing on peer -to- peer share markets such as LocalBitcoins or Paxful. P2P stock exchanges allow users to trade their coins through an external payment system, for instance, PayPal or bank cards. Unlike Bitcoin, transactions made via this very type of payment method can be disputed and tracked, if necessary. Fraudsters use such share markets to empty someone´s PayPal or bank account. To avoid scammers on P2P stock exchanges, sell your Bitcoins only to authorized dealers and stay away from payment methods requiring access to your PayPal or Skrill. Remember, those who control their private access keys, control their Bitcoins.