Since many people try to make money by investing in new Bitcoin-related projects, they are easy prey for scams. In fact, today we show you some of the biggest scams, carried out with Bitcoin.
To better understand, a scam is a way to steal money from people under false pretenses. The main characteristic of a Bitcoin scam is that it usually takes advantage of people’s trust and negligence.
Biggest Bitcoin Scams
It is a long-standing and global pyramid scheme. Indeed, the OneLife, OneAcademy and OneWorldFundation firms are part of the same scheme.
For its part, OneWorldFundation presents itself as a charitable organization for children. That accepts donations in OneCoins, PayPal, bank transfer, and debit and credit cards.
Specifically, these OneCoins were never listed on any Exchange. And the only way to change them to Fiat money was on the OneCoin Exchange. This was until 2017, when the exchange closed without warning.
In the same year, Ruja Ignatova, the leader of the entire scheme, disappeared. But, in March 2019 Konstantin Ignatov was arrested. Unfortunately, Ruja (The crypto Reyna) is still missing and with her a large part of about 4,000 million dollars.
Now, according to a Finance Magnates story, it appears that Ignotov is no longer one of the main defendants in legal actions brought by victims of the scam.
2. Milton Group
Similarly, a group of multilingual telemarketers meet in an office in Ukraine, Albania, Georgia or North Macedonia. And thus follow established guidelines to scam with Bitcoin, the largest possible number of unsuspecting people.
Operating under false names such as Cryptobase, CryptoMB and VetoroBanc, the methodology of this alleged investment company consists of spreading advertising on social networks. On get-rich-quick schemes through investing in the stock market and Bitcoin.
But everything is a lie. The balance they can see is nothing more than numbers on the screen. And that is only confirmed by victims when they try to withdraw their alleged earnings.
3. Plus Token
This platform was the great crypto scam of 2019. The main offering of this system was the PLUS token.
Perhaps one of the reasons for its success was based on the fact that, instead of advertising through electronic media, most of it was through meetings and events. That allowed them to speak with potential investors face to face.
At the end of 2019, users began to have problems withdrawing their funds and administrators blamed the alleged miners. Soon after, they disappeared with roughly $ 3 billion. Ultimately, much of the scam was amounts in Bitcoin.
This case was different, since it was a decentralized cryptocurrency at the time. The Texas State Securities Board, issued a closure order, claiming that it was only a pyramid scheme and that it was misleading its investors. As a consequence, on January 17, 2018, the BitConnect team decided to close its lending platform.
Unfortunately, the crypto world has been quite fertile ground for all kinds of scams, since a lot of education is needed on various topics.
5. Fake exchange houses
Bitcoins and other cryptocurrencies are acquired in exchange houses called Exchanges. There are dozens of exchange houses, so it is difficult to know them all.
That is why one of the most elaborate scam methods includes creating a fake Exchange. With the aim of making unsuspecting users deposit their cryptocurrencies in them.
This is what happened in South Korea in 2017, when a fake exchange called BitKRX made millions of users think that it was a legitimate Bitcoin exchange site.
6. Phone call scam
Basically, someone could contact you posing as a company. Also, tell you a false story and not only ask for your credentials, but also urge you to deposit funds in a wallet.
Thus, this is what happened to an older woman in Canada. A scammer contacted her by phone, assuring her that she was a member of the local police and that she owed a large sum in taxes, so she had to go to Bitcoin ATMs to solve them.
Certainly, before the fraud was discovered, the woman even deposited $ 17,000.
Thanks to desperation, there is no person who does not want to safeguard his economy with whatever way he has at hand. Thus, Bitcoin has been one of the tools that has decided to be used in fraud.
7. The hacker «El Esteban»
In reality, he is an alleged Venezuelan con man, known for being the author of various computer crimes and scams. Among which stands out the theft of Bitcoin (BTC) from foreign accounts.
It is public knowledge that the happy Esteban worked in complicity with the owner of a vehicle dealership, which was in Anzoátegui state in Venezuela. Apparently, they processed the sale in Bitcoin (BTC), to then never deliver the agreed car.
Fortunately, the authorities arrested him in May this year. When he was preparing to make a purchase via Facebook paying with Bitcoin.
Finally, research and education are the key to avoiding scams. So educate yourself, research Bitcoin, and don’t believe everything you read.
I say goodbye with this phrase from Philip James Bailey: «The first and worst of all scams, is fooling yourself».