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Popular Bitcoin Scams in Australia and How to Avoid Them

The efforts of every scammer always focus on imitating processes that work through deception to attract gullible and careless investors.

Posted September 10, 2020
Last updated August 29, 2022

Illustrate of a computer with a bitcoin logo on the display with two thieves attempting to break in to illustrate the topic of popular bitcoin scams.
Illustrate of a computer with a bitcoin logo on the display with two thieves attempting to break in to illustrate the topic of popular bitcoin scams.

The rise of Bitcoin and other cryptocurrencies opened a new door to the world of investments with short, medium and long-term results. This gives many people the opportunity to partner with futuristic technologies to buy and sell these digital assets.

However, as in all fields where there is money involved, there are also people whose intention is to take advantage of a good investment opportunity to take money from said investors, with for instance, Bitcoin or cryptocurrency scams. This happens thanks to misinformation and hoaxes that lead to a tragic deposit to the wallets of these criminals.

There have been many scams related to the crypto ecosystem and there will continue to be, mainly because it is a totally digital field and people can carry out a scam without presenting their faces.

Lack of knowledge about how the technology of these cryptocurrencies works can lead to making mistakes. A common mistake is also to believe in false information and to deposit tokens in a place from which it will never return.

Common Bitcoin scams and frauds

The efforts of every scammer will always be focused on imitating processes that work through deception to attract potential investors who will believe them.

If a criminal created a totally new concept, it would raise more suspicion than if he “offered” a service that other people are already familiar with, such as a crypto wallet, a crypto exchange, cloud mining platforms and card services debit Bitcoin.

So, below are a few examples of “classical” methods that criminals use, that unfortunately too many people still fall for.

Phishing attacks

Phishing is the attempt to trick the owner of a particular email address through malicious emails into opening it and following its instructions. Considering that the victim is the one who will initiate the scam against oneself, the victim must carefully follow the scammer’s instructions.

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The scammers themselves often pose as reliable companies and / or initiatives, as could also be a state body, a supplier or client of a company.

An illustration of email phisings in Bitcoin scams
One way to counter phishing attacks is to exercise a healthy dose of skepticism. Source: Mohamed Hassan on Pxhere

The email sent by the attacker could have attached some highly malicious file (as in the case of downloadable documents or links to compromising sites) that, once it is opened or downloaded, can damage the user’s computer or incapacitates it through installation.

In case the attack is targeted with a malicious link, the site to which it takes you usually appears legitimate, but is actually used to collect confidential information, such as usernames and passwords, or to install malware on the device.

Fake exchange

A cryptocurrency exchange is the meeting point where people buy Bitcoin with fiat currency and exchange digital assets. In these online exchange platforms, the market price marks the value of cryptocurrencies based on supply and demand.

These companies usually offer optimized trading services with high ROI (Return on Investment) opportunities, so they would obviously be the target of scammers looking for a trading / exchange platform to invest their money. We can be wary of exchanges if certain conditions are met that together may indicate that it is safe from scam.

First, it is necessary to know if said company is regulated. If it is, you can be sure that it is a legitimate business. Under surveillance, it is impossible for an exchange to scam its users.

Fraudulent debit card services

Bitcoin debit cards are one of the most common bitcoin scams in the crypto ecosystem, although it has already gone a bit out of fashion in recent years. These fake debit card providers deceive their customers, making them deposit bitcoin tokens to their wallets and filling out forms for shipments that will never arrive, or simply arrive and do not work. In the case of this service, 90% of the cases are scams.

An illustration of hacker scams through fake credit cards
Bitcoin scams through fake credit cards. It’s still common! Source: Mohamed Hassan from Pixabay

However, in countries like Australia, they have very little effect because many businesses are accepting payments in Bitcoin and there is a wide availability of ATMs. So, there really is no need for a BTC debit card to purchase goods and services.

How to avoid falling into Bitcoin scams?

You can avoid falling for crypto scams by following a series of rules, which will always keep you on the safe line as you learn your way through the world of cryptocurrencies.

  1. Whenever you are going to deposit your tokens somewhere (regardless of their nature), investigate their policies and the experience of other users on that platform. Make sure that you are putting your money in trustworthy companies and that you will really get the service you are looking for.
  2. When you are about to log into a wallet or exchange service, check the URL and confirm that it is the official link of the site you are visiting. Many times they create fake pages to steal our data and enter our accounts.
  3. Any email whose emissary you do not know is spam or a phishing attempt. Keep those emails at bay and always keep them in a spam folder. Never interact with the content of an email whose nature you do not know.
  4. Do not pay attention to Ponzi pyramid schemes where they promise passive profits based on the investment of referrals or people that you will have to look for to receive money, because it benefits nobody but the earlier members who “invited” you.

Stay safe in the crypto space

Easy Crypto is more than just a cryptocurrency exchange in Australia. Our goal is to have people understand first how cryptocurrencies work, how to safely interact with the ecosystem, and then give them continuous guidance on how to invest in cryptocurrencies for a better future.

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Disclaimer: Information is current as at the date of publication. This is general information only and is not intended to be advice. Crypto is volatile, carries risk and the value can go up and down. Past performance is not an indicator of future returns. Please do your own research.

Last updated August 29, 2022

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