Bitcoin is a digital currency that was created to make paying for things a lot easier, but things didn’t end up like that. Today, Bitcoin is being used and abused by scammers worldwide. While there is blockchain that is meant to protect Bitcoin, it is clearly not enough to protect most people from Bitcoin scams. Below are the 5 worst Bitcoin scams that you must avoid at all cost and how they were used to scam people.
Bitcoin Gold and Stolen Bitcoins
Bitcoin gold was supposed to be another cryptocurrency, different in some aspects but also uses the Bitcoin brand. The issue with it started when techy scammers created a very convincing website that promised to give out Bitcoin gold wallets to people who would give them the keys to access their cryptocurrency wallets.
People fell for this Bitcoin scam and they fell hard. The scammers carted off about $3 million Bitcoins plus other cryptocurrencies. The scam was so convincing that even the creators of Bitcoin cold advertised the scammers’ website, mybtgwallet.com on their site.
Mt. Gox Bitcoin Crash
Mt. Gox was a Tokyo-based Bitcoin exchange that used to process the majority of Bitcoin transactions from everywhere in the world and people though it was very safe. The bad news is, Mt. Gox isn’t as safe as people thought and that it was also ridden with fraud, corruption, embezzlement, and a mountain heap of tangled mistakes.
Mt. Gox filed for bankruptcy and announced that they’ve lost $450 million worth of Bitcoins at the time which is about $8 billion in Bitcoin value these days. This resulted in a massive crash and the full story evades the light of truth to this day.
Canadian Bitcoins Scam
Canadian Bitcoins used to be an exchange that is used to manage Bitcoins for investors in Canada but perhaps their biggest mistake was leasing some space at the Rogers Data Centre for some of their important data. One day, a scammer sent an email to the Rogers Data Centre and claimed to be Canada Bitcoins CEO, asking for security codes. Long story short, Rogers Data sent the security codes to the scammer without verifying who the email really came from. The scammers were able to get away with $100,000 worth of Bitcoins.
The Silk Road Email Trap
Silk Road is a site belonging to the Tor Network. While it wasn’t created to be a scam, it was used by many to peddle drugs and other illegal items on the Dark Web. When Silk Road was taken down by the FBI, Bitcoin was able to secure a better position as a legitimate cryptocurrency but then the government chose to auction the Bitcoins they seized from Silk Road and in so doing, made a BCC mistake in the email they sent to potential participants. Scammers copied the list of those interested and the rest is history.
An optioment scam is a fraud that looks like they’re offering an opportunity for buying cryptocurrency but is in reality just another investment fraud. Beware of fraudulent web companies posing as a new business with promises that are too good to be true.
Know that Bitcoin scams are just a small portion of the cyber security issues everyone is facing these days. It pays to not only be aware of cyber security threats, but also have effective measures to combat them. If you need help with this, contact us and we’ll see what we can do for you.