While bitcoin as a technology is safe, scamsters keep finding newer ways to defraud bitcoin holders. There many been many instances of people being tricked into transferring their digital coins to fake accounts.
According to reports, a bitcoiner was recently defrauded of bitcoins (BTC) worth about $1.1 million in a fake giveaway scam. This was one of the single largest transactions as far as fake giveaway schemes are concerned. The perpetrator reportedly identified himself as MicroStrategy’s chief Michael Saylor and promised to double the number of bitcoins received. However, once the victim completed the payment, the perpetrator vanished into thin air with the loot.
Saylor is one of the biggest crypto supporters owning most BTC and is often impersonated in such scams. The scams, Saylor, pointed out in a tweet, continue despite repeated alerts from his team to unsuspecting bitcoiners. “489 of these scams were launched on YouTube last week. We report them every 15 minutes and they are taken down after a few hours, but the scammers just launch more…,” Saylor said in the tweet.
But what exactly is a giveaway scam?
Most crypto scamsters find their victims through social media platforms such as Twitter. In giveaways, scamsters create fake Twitter handles impersonating famous personalities in the crypto market, such as Saylor, or other influential celebrities. They then post tweets about the industry and offer some interesting rewards such as a promise to match or sometimes even double any crypto sent to their account.
Similarly, scamsters also launch unsuspecting YouTube channels that provide investment advisory on bitcoin and regular market updates. On the surface, these channels look like legitimate entities that can help you with your investment goals. However, once the victim takes the bait and makes the payment, the YouTube channel is instantly taken down, and the victim is left in the lurch.
As bitcoins are designed to reduce intervention from intermediaries in a transaction and as it is not regulated in most markets, tracking the culprits of bitcoin scams become tricky. Over time, the scammers have also taken their pitches up a notch. Bitcoin scams have now become more aggressive and professional, making it difficult for the everyday investor to ascertain fake from real. More than $800 million have been stolen so far through such fake investment pitches.
As such frauds continue to rise, a regular investor wonders, not only about the future of bitcoin, but also on how to save oneself from falling prey to these frauds.
It is important to note that these scams are not a result of any fallacy of the bitcoin cryptocurrency. Instead, these frauds are successful because the investors lack the appropriate knowledge to defend themselves against such schemes.
For starters, bitcoin is a volatile asset; anyone promising/guaranteeing returns in such a market is a big bright red flag. If an investment adviser approaches you with an exciting opportunity, it is good practice to verify their documents and licenses first. Also, do not trust a tip or investment advisory received from unsolicited sources.
While there are many knowledgeable people on YouTube, you should do your own research before making an investment decision. All these bitcoin scams have been successful as the investor lacked crucial knowledge. Therefore, the best and easiest way to stay safe from such scam is to keep yourself educated and updated with market trends.