Investments in cryptocurrencies represent billions of dollars worldwide. It would have been surprising if internet scammers did not want to hack this market. To protect against this threat, below you will find possible ways to stay safe and an overview of the most common scams to steal your cryptocurrencies.
Ways to stay safe from these scams
Most strategies for avoiding these scams are based on caution and common sense, but some specific tools or methods can help you be even more protected:
Connect via a VPN: The definition of a VPN is a tool that allows you to connect privately to remote servers via the encryption of your data. This simple, inexpensive service will prevent you from revealing your location and online activity and will help protect you from attacks by scammers targeting your cryptocurrency assets. Also, some VPN providers offer additional features, such as an ad blocker or malware removal.
Secure your passwords: Each of your accounts must have a unique password (this prevents theft from affecting all your accounts) and the password has to be strong (this prevents it from being easily doceded). To make it easier, use a password manager to handle this for you.
Use double authentication: This method sends a code by SMS or email each time you connect to an account to verify your identity. In the event of theft of identifiers and passwords, a scammer cannot, therefore, connect to your account.
Do not give your usernames and passwords to a dubious email: Emails that contain a link to click should put you on alert, especially if they require you to enter your passwords. Be vigilant in this area and use common sense to verify their authenticity.
The different types of cryptocurrency scams
Of course, there are many methods used by scammers, but the following are the most common. It is good to know them and learn how to detect them:
Phishing
Phishing scams are a classic and are also used in the world of cryptocurrencies. Hackers seek to steal your account credentials. That includes your cryptographic keys, as the person who holds this key owns the account’s all cryptocurrencies.
Phishing scammers work in a way where their main goal is to trick a person into clicking a link, which leads to a fake website. Then they are able to steal your account information. Usually they impersonate reputable companies, such as a bank, utility companies, or big brands like Amazon or eBay.
For example, they may send you an email noticing that a withdrawal has been initiated and thus you have to click on a link to cancel the transaction. Surely, that link is a fraudulent website and once you click on a link, they are able to access all the personal information and use it for their advantage.
Fake exchanges and fake crypto wallets
There are tons of ads for services touting cryptocurrencies at 5% below market value and promising huge savings when you buy from their site. But, often, these platforms are just lying.
They promise huge returns on investment, counterparts of relatively high initial costs. In the end, your invested funds have disappeared when you wish to withdraw them.
To avoid such scams, stick with reputable exchanges and wallets with a long track record.
SIM swapping scams
SIM swapping scams are quite a new method to steal cryptocurrencies. They happen when a scammer gains access to a copy of your SIM card. Once this happens, a scammer is able to see all the data on your phone.
This information can then be used to receive and use the two-step authentication codes needed to access wallets without the victim’s knowledge. When the victim’s cryptocurrency holdings can be hacked and stolen without the victim even being contacted.
Software update scams
Software is constantly being updated, and cryptocurrency platforms are just another form of software. Since these upgrades are commonplace in the digital age, scammers can easily trick cryptocurrency holders into giving up their private keys as part of an “upgrade.”
