How To Avoid Being Scammed When Buying Bitcoin
Do you associate bitcoin with wealth? Many people do. Earning money with bitcoin is possible but only if you take a smart approach to the process while always being ready for the unexpected.
After the cryptocurrency’s huge price run in 2017, many people decided to buy or mine bitcoin with hopes of becoming rich. While some of them managed to earn money, the majority faced difficulties.
Knowing that numerous newbies are trying hard to make a fortune buying bitcoin, scammers have come up with many different ways to acquire their money.
If you are planning to buy bitcoin, consider the following tips. They could help you avoid scams while increasing the chances of staying afloat.
1. Use VPN
Man-in-the-middle attacks have been popular since the time bitcoin appeared. This attack could change the destination of your bitcoin transaction. Hackers appear on the bitcoin’s route from sender to recipient and divert the transaction to their account.
When you are buying or selling bitcoins, such an attack could cause you serious problems. Hackers use malware sent via emails or shared Wi-Fi networks to intercept your bitcoin transactions.
To be on the safe side, always use a VPN when purchasing or selling bitcoin. VPN helps with proper end-to-end encryption.
2. Beware of Phishing Scams
Phishing scams have been around for decades. Today, scammers use them to get your bitcoins. When people want to buy bitcoin instantly, they tend to forget about simple safety precautions.
Such a scam usually involves a hacker sending a victim a fake email, which looks like an email from a reliable service (for example, blockchain.com). The email tells users that they must log in to their wallets to view a new policy, change settings, accept money, or whatever other reasons hackers could come up with.
The link leads the user to a phishing website, which looks exactly like the reliable site they want to get to. Once the user enters private information, hackers steal it.
Avoiding phishing scams is easy. Be extremely careful when clicking links in emails. It’s better to access websites directly from your browser. If you do proceed to a website from an email, make sure it has an SSL certificate (a little lock icon near the address line).
3. Choose an Exchange Carefully
To buy and sell bitcoins, you need to choose a reliable exchange. Many popular exchanges charge high fees, which puts some of the users off. That’s when scammers come in. They create exchanges that seem to offer excellent terms of services for newbies.
Scammers usually say that the exchange is a branch or an affiliate of a respectable trade, making people forget about safety. Users transfer money to the exchange to get nothing in return.
Be careful when checking the credentials of the exchange. Don’t fall for the “branch” or “affiliate” scam. Always read reviews before taking advantage of the exchange’s services.
4. Make Sure You Buy Real Cryptocurrency
Before jumping into a seemingly attractive cryptocurrency deal, make sure the currency exists. Scammers create a fake cryptocurrency and offer you a chance to buy it at a low price. Some people fall into the trap because they don’t want to spend a fortune on bitcoins.
Fake cryptocurrency creators usually work hard to make their currency appear credible. They claim that they work with well-known partners and create high-quality websites to make themselves appear respectable.
Before buying a cryptocurrency, visit several exchanges to find out if it’s being traded there. If not, it may be a scam.
5. Be Careful About Cloud Mining Services
Many people try to mine bitcoin. Today, such mining isn’t always profitable. In the majority of countries, people pay more money for equipment and electricity during the mining process than they get in return.
That’s why cloud mining services exist. They allow people to rent server space to mine coins. Scammers take advantage of such schemes. They offer remote server space for a certain fee but never actually provide it.
It’s easy to avoid such a scam by doing proper research before taking advantage of such services. Can you find any legal information about the company offering such services? Does the company have a website? Does it have a blog section? Can you find any reviews?
Finally…
When you are buying bitcoin, you have to remember that the cryptocurrency is highly volatile. Even though hundreds of people have become rich buying and selling bitcoin, many more have lost fortunes.
Before you dive deep into the world of cryptocurrencies, exchanges, wallets, and trading, do your own research. You are the only person responsible for your money.
Bitcoin and blockchain are young concepts. The lack of information and education leads to serious scams and fraud. Make sure you don’t fall into the above mentioned traps.
