Bitcoins are no longer only an elusive financial asset somewhere in the digital ether. Instead, they’ve evolved into real cash that may be carried in your pocket or scratched off lottery tickets. Unfortunately, since they have become a form of payment now, scammers utilize them to conduct bitcoin scams.
What exactly are bitcoin scams?
Individuals or groups seek to defraud or mislead innocent victims into sending them Bitcoin. This conduct is called a Bitcoin scam. Like all financial deceits, Bitcoin scams are continually developing, and investors should become familiar with recognizing the scam and the bitcoin scam broker.
Identifying a bitcoin scammer
Identifying a bitcoin scammer is a necessary part of bitcoin trading. Because bitcoin trading is full of brokers, some genuine, some fake, you must be able to identify a fake broker. While identifying is necessary, it is also wise to know that many bitcoin scam recovery firms will help you restore your lost wealth. They contain elite personnel of lawyers, financial experts, and fund recovery agents.
Following are some ways to identify a bitcoin scammer
Assured and guaranteed returns
It’s critical to examine the offer and determine whether it’s reasonable. Fabricating false promises of profits is one of the ways fraudsters attract money to their schemes. Tread cautiously if you don’t have a strategy or supporting information for why this initial coin offering (ICO) – the phrase for when a new cryptocurrency is formed and people are allowed to buy some at an early price – would rise so quickly.
Offers are heavily promoted and marketed
Another way bitcoin scammers recruit victims is by spending a lot of money on advertising. Full-page newspaper advertisements, massive banner ads on websites, and a slew of sponsored bloggers are all geared to reach a wider audience as possible in the shortest amount of time to raise money quickly. However, since it will grow and develop gradually, a more credible digital coin offering will not need to promote or expand as soon.
Members of the team who are unnamed, ambiguous, or perhaps non-existent
You ought to be able to readily discover who is running a bitcoin, along with every member of the team, just like you would with any other business or investment. You may look into their background and social media profiles to discover how old they are, who follows them, how many followers they have, etc. It may seem like a lot of work, but if a handful of the team’s developers aren’t online, the directors have hundreds of followers, all of whom are paid for, and in case you don’t hear back after contacting the organization, skip it.
Read the whitepaper; every bitcoin needs to have one
The whitepaper for bitcoin is one of the most critical aspects of an initial coin offering. It will explain how the bitcoin project was created, how it will grow, and how the selling will work. If you’re studying a whitepaper and wondering, “this doesn’t make any sense,” it’s possible that the founders are attempting to confuse their investors by presenting a false product.
There is no code available
Don’t let this one deter you. Only a few people will be qualified to read a bitcoin’s codebase. The code is what makes bitcoin work, and the majority of reputable bitcoin firms will release their code ‘open-source.’ This means that it is available for anybody to read, change, and verify that it is what the founders claim to be. Of course, simply because you can’t read the code doesn’t imply that you shouldn’t be able to view it. If a bitcoin team keeps its code hidden, red flags should be raised. What are they attempting to conceal? Although not every legal and genuine cryptocurrency has its code publicly sourced, nearly every illicit and fraudulent bitcoin does.
Bizarre investment packages
You may be offered the possibility of subscribing, investing a particular amount, and receiving a daily or weekly return. This type of return is unsustainable. You must read the papers and understand how they work.
Keep an eye out for phony brokerage firms and brokers
You can purchase and sell currencies using a bitcoin exchanges platform. Do your study and read platform ratings. Some will advertise fantastic deals, implying they can beat exchange rate changes, and employ automated technology to ensure you get the best deal. Brokers might be unreliable. The broker’s tempting initial offers and once-in-a-lifetime deals are meant to get money out of your wallet and into your website.
These strategies are overhyped on trading platforms and broker websites and can cost you money. For example, when trading bitcoins using pounds, dollars, or euros, they often charge hefty withdrawal fees or a large commission. They may also add extra steps for trading or withdrawals, extending the process by several hours. So before you hand over your money, read the fine print.
Identifying a bitcoin scammer is a critical aspect of bitcoin trading. Hence, every trader, especially a novice, should know how to identify one. Following the above steps will help you recognize a bitcoin scammer and avoid going that path.