How not to become a victim of a scam when buying and selling cryptocurrency?

There are always scams when it comes to money, and cryptocurrencies are no exception.

In February 2022, the Wormhole cryptocurrency exchange lost $320,000,000 after a cyberattack. In addition to this attack, crypto scammers have stolen more than $1,000,000,000 since 2021, according to a FTC report.

Digital currency is a form of currency stored in a digital wallet, the owner can exchange this currency for cash by transferring it to a bank account, for example. Cryptocurrency like bitcoin is different from digital currency. It uses the blockchain to verify transactions and does not pass through financial institutions, so it is harder to find, much less recover from theft.

Despite the fact that cryptocurrency is still a relatively new financial asset with more reliable protection, thieves have learned to steal it using the old methods of theft. We will consider some of them further.

The most popular cryptocurrency scams:

• Investment schemes. When choosing this method, scammers contact investors and present themselves as experienced "investment managers", saying that they have already earned more than one million on investments and will help their potential victims earn the same. In this case, the attackers demand an advance payment (advance payment) and simply disappear with it. In addition to the advance, they may request more sensitive data, such as a wallet password, etc., than they can easily appropriate assets.
• Rug pull (literally translated in English - to pull the rug out from under someone). In other words, the development team suddenly abandons the project and sells or removes all of its liquidity. A popular version of this scam was the Squid coin, named after the popular Netflix series Squid Game. Investors had to play to earn cryptocurrency: people bought tokens for online games and later earned more to exchange them for other cryptocurrencies. The price of the Squid token has risen from 1 cent to around $90 per token. Eventually the trade stopped and the money disappeared. Then the value of the token reached zero. The scammers made about $3 million from these depositors.
• So-called romantic scams. The essence is quite simple, because many similar situations have happened with fiat money. Basically, such scams have been seen in mobile applications that are designed for dating. The scammer finds the victim, сreeps into favour in every possible way and after some time asks for money in one or another cryptocurrency. Having received what he/she wants, the swindler disappears.
• Phishing. And although phishing has existed for a long time, it still does not slow down its momentum and is very popular among villains. Often, scammers send emails with malicious links to a fake website in order to collect personal data, such as cryptocurrency wallet key information. Each key is unique and different from regular passwords that can be changed all the time. With the keys, the situation is different - if the key is stolen, it is almost impossible to change it, as a result of which you lose your crypto assets. So, perhaps, do not follow dubious links, and if you know the site from which this or that message came, then it is best to go to it directly, but not via the link sent.
• Man-in-the-middle attack (mediator attack or man-in-the-middle attack). Using the public network, the user logs into his account where the crypto is stored, so scammers can steal this information. It is not difficult for thieves to get hold of any personal information, including crypto wallet keys, passwords, etc., that is used in public networks.
• Distribution of cryptocurrency in social networks. There are a lot of posts on social networks about the distribution of free tokens and coins. However, most of these offers are distributed by scammers. By clicking on this or that link, the user can forever say goodbye to his crypto.
• Financial pyramids. Everyone has heard about MMM, so the crypt could not do without such pyramids. Circular circulation of the same money - old investors are paid with the money of new ones, while everyone is promised big money with minimal risks.
• Fake crypto exchanges and crypto exchanges. Attackers lure investors with loud promises and the benefits of trading crypto on a new exchange or buying / selling through an exchanger, but in fact there is no exchange or crypto exchanger, which the investor will find out after he has lost his funds.
• Employment fraud. Quite often, scammers pretend to be recruiters or applicants in order to gain access to crypto accounts. In some cases, they may offer interesting jobs, but first you should pay for training in cryptocurrency. This kind of attackers can get a job in a crypto project and just as well get access to valuable information, which gives them a chance to take over someone else's crypto. So managers should be vigilant and carefully check who they want to hire.

And, perhaps, we have given not such a large list of fraudulent schemes with cryptocurrency, since there are many times more of them, but at least some of them will help you recognize obvious scammers who want to cash in on your cryptocurrency.

How not to become a victim of cryptocurrency scams?

Many crypto fraud schemes are quite complex and look convincing from the user's point of view. But knowing and understanding how the most common crypto scams work and what methods are used most often by criminals to steal money from investors is the first step in avoiding them. But there are other methods by which you can save your cryptocurrency:

1. Never be fooled by promises of big profits or doubling your investment.
2. You should be alarmed by the only payment option for a product or service, that is, with cryptocurrency.
3. Pay attention to any typos and grammatical errors in emails, social media posts, or any other communications.
4. Do not succumb to manipulation, such as extortion or blackmail. 
5. Remember! Free cheese only in a mousetrap! No one will give you any money for nothing.
6. Quite often, scammers refer in their messages or display on advertising banners celebrities who allegedly also take part or advise this product/service/project. Do not fall for such tricks, in 98% of cases they do not even know and have not heard about such pranks at all, etc.
7. Create secure passwords, store access keys on trusted media, use a secure connection or VPN, and choose a secure storage for your crypto.
8. Check the resource for buying/selling the crypt on which you have chosen. You can first use a small amount to make a purchase or sale, so if the site is fraudulent, you will not lose a large amount, and in case of a successful transaction, you can be sure that the site is reliable.
9. Work only with those services, in the work of which you were able to understand. Do the same with the choice of crypto for your portfolio - if there is little information about the coin or you could not figure out how it works at all, then it is better to opt for more well-known ones.
10. Never rush into your choice. Very often, scammers put pressure on their victims, offering them lightning-fast discounts, promotions, bonuses, which are very difficult to refuse, but require a decision to be made right away. Do not rush, money does not tolerate such an attitude, weigh the pros and cons. It is better to stay with what you had than to lose everything and blame the whole world for it.
11. Double-check the advertisements that you see on social networks, as very often scammers use this very source. Such financial instruments as a cryptocurrency exchange or a cryptocurrency exchanger cannot exist without a website, behind the beautiful cover of which is hidden a powerful currency conversion engine. Thus, none of these tools will offer their services without developing their website. Therefore, if you see tempting offers from a company, at least check if they have their own website.
12. Check for reviews. In continuation of the previous paragraph, it is worth mentioning a very important point that should greatly influence your choice - reviews. Examine the availability of reviews about the work of the service on the site itself, as well as on other specialized sites. Analyze these reviews, because not everyone can always like everything, so solid positive reviews should also alert you.
13. Only download mobile applications for cryptocurrencies from official sources - Google Play Store or Apple App Store.
14. Buy cryptocurrency only with the money you can afford. No need to invest the last savings, as the crypto is still a very unstable and speculative asset.

Well, this list can be continued for a long time, but it is worth considering that the cryptocurrency is a fairly young system and in most countries it is not at all regulated by law. Thus, there are more and more opportunities for attackers who want to deceive crypto owners in every possible way, each time coming up with new tricks. This fact should not scare you, continue to invest in cryptocurrencies, but be more vigilant. Keep in mind the popular crypto scams we wrote about above and choose platforms for buying/selling cryptocurrencies more carefully. We wish you good luck and profit!