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Being that bitcoin is so popular, it is going to be easy and common for people to try and create scams that are going to be aimed at consumers so that they can try and get money out of Bitcoin users. However, there are some scams that you are going to want to keep your eyes open for so that you do not become a victim. The more that you know about the scams you may come up against, the better that you are going to be able to protect yourself from them.

Ponzi ploys and high-yield investments: These scams are going to be meant to bring people in by promising them of high-interest rates on the deposits that you make. Anyone who invests initial is going to be paid out by the investors that come along at a later time. Whenever the new investors stop joining, the payments can no longer be made which means that the ploy ends up collapsing. These scams are typically going to last a few months if they are lucky, but, the people that are behind the ploy are going to come back and repeat the process again even if it is at a later date.

Mining investment scams: A mining scam is going to involve the verification of negotiations so that it is ensured that there is going to be security for those using the public ledger. These processes are going to typically involve orders for equipment where you are going to pay for the equipment beforehand but you are not going to receive anything. When these types of scams are carried out, a powerful and expensive computer is going to be required to keep track of all of the “orders.”

Wallet scams: As it has been mentioned in previous chapters, a wallet is usually going to require some sort of software program that is going to allow you to store coins. Wallet scams are going to be where consumers are told that they can make a transaction that has more anonymity. You will have to place enough coins into your wallet and the scammer is going to take those coins and move them to their own wallet, and you are never going to see them again.

Trade scams: A trade scam is going to pull a Bitcoin consumer in by offering a credit card processing rate that is going to be more competitive than other competitors. The trade is not going to give anything to the Bitcoin consumer once payment has been sent.


Phishing scams: Phishing scams are going to be scams that come through your email informing you that you have won Bitcoins. Once you click on the link that is in the email, you are going to put your wallet information in and instead of you getting the coins as you think that you are going to get, you are going to be giving your coins to the person that sent out the scam.

Avoiding scams

It is highly advised that you ensure that you are investigating every company that you are looking into for Bitcoins. You are going to want to make sure that they are completely transparent in what they have to offer. Should there be any place in their business plans or services that you cannot see everything that is involved in the process the company is most likely going to be fraudulent and, you are going to want to try and stay away from them.

There are going to be some public audits that you are going to be able to find that will assist you in avoiding any doubt when it comes to ensuring that a company is delivering on everything that they have to offer. A proof of reserve audit is going to be made so that you can force a company to disclose their Bitcoin holdings publicly.

Make sure that you keep in mind the old saying “if it looks too good to be true, then it probably is.” When you are dealing with Bitcoins, you need to make sure to treat it as you would cash. Protect it and do not just leave it alone for others to steal.

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