Avoiding Most Common Blockchain Payment Scams

A Bitcoin mining service was hacked of $64 million in late 2017, underscoring once again how the world of digital currency attracts scammers and thieves. Such stories make the newspapers headlines and have the potential of scaring off amateur investors who fear not only market volatility, but also insecurity of the technology.

The reality is that blockchain technology is secure, and users are protected when using it. Blockchain has not been hacked so far and the prospects for this to happen are very low mostly due to its flawless tech infrastructure. The real problem is that not everyone understands how it works, which leads people to make choices that can expose them to theft.

With blockchain getting popular, online scammers have started taking advantage of it. The fraudsters are doing this by sending fake emails to potential victims asking to follow a link and insert account details or go at lengths to obtain private keys of wallets. At the same time, crypto fans need to be aware of the fact that blockchain payments are irreversible – once a payment is done there is no way back or a refund.

That being said, you need to be sure and review the service you are using for making payments. Any parties that seem unsafe or do not expose much activity should not be taken into consideration. Do not fall in the trap if someone rushes you to make a payment as, chances are, you will not get your money back.

Most common scams involve ‘phishing’ – emails sent to people that contain a link which send the user to a fake website. Always check whether it is the legitimate website. This is why blockchain account holders should never click on a link in an email message to sign into their accounts. They should go directly to the exchange website or blockchain platform and sign-in from there instead. Established service providers will never ask you to log in to your account via an email. Blockchain account holders who have been tricked by the scam are asked to attempt to change their passwords and contact the service provider for help. But, in the meantime, the scammers got your account credentials.

Often, phishing emails, mention the user received a blockchain payment and he/she needs to login and validate it. It all looks tempting, but make sure it is true. If you want to login to the website, open it separately by manually typing the address instead of following the link.

To help protect their accounts against phishing scams crypto account holders can enable 2-Step-Verification on their accounts. This is an extra layer of security that will prevent cyber criminals from gaining access to their accounts even if they have stolen their account credentials. Additionally, one should look at proper storage of their digital currencies – most safe one is a crypto wallet in an offline environment – desktop, hardware or paper (also known as ‘cold storage’).

Finally, blockchain technology is essentially a decentralized, immutable database of transactions open for anyone to check and validated by a distributed collective of verifiers. The main aim of its design is to ensure that no party can alter any past transaction record. Technically speaking, blockchains effectively accomplish this goal. It all sounds like a new digital revolution is underway, yet scammers take advantage of its weakness, immutable transactions, and make blockchain applications very costly in terms of fraud, theft, and legal jeopardy. As a crypto user, make sure you follow guidelines to protect your investment and also share this knowledge with others to raise awareness and minimize fraud opportunities.

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