With the rise of cryptocurrencies, various online scams have become increasingly common. Let's delve into the two main types of crypto scams, giveaway scams and transfer scams, and check out the prevention tips to help you stay vigilant and protect yourself from fraud.
I. Cryptocurrency Giveaway Scams: The Tempting Trap
1. How the Scam Works
Giveaway scams prey on people's hope for unexpected riches. Scammers post fake giveaway events on social media and other platforms to lure victims. Here’s how this scam typically works:
(1) Creating a Convincing Fake Identity
Scammers set up social media accounts and websites that mimic well-known companies or celebrities to appear credible. Then, they post about the cryptocurrency giveaway.
(2) Offering Attractive Fake Prizes
They announce that you can receive a huge reward by completing simple tasks, like paying a small fee. These rewards often include cryptos, luxury cars, or even mansions.
(3) Collecting Personal Information
Victims are asked to provide personal details such as email addresses, phone numbers, and crypto wallet addresses, setting the stage for further scams.
(4) Charging Fees
Scammers ask victims to pay fees for identity verification or other reasons. This is the main source of their profit.
(5) Scammers Disappear with the Funds
Once the victims pay the fees, the scammers vanish along with the funds and the promised rewards.
2. Scam Scenario
User A receives a message on social media from someone claiming to be a BingX staff. This "BingX staff" shares a photo of a Crypto Box, claiming it contains up to 1,000 USDT in rewards. The "BingX staff" tells User A to scan a QR code and send 1 ETH to a specified address to claim the reward. In the end, User A didn't receive the promised Crypto Box and loses their funds.
3. Prevention Tips
- Carefully verify the authenticity of social media accounts and websites. Watch for spelling mistakes and design flaws.
- Be skeptical of offers that seem too good to be true. Legitimate giveaways won’t ask for payment.
- Use a separate contact information when participating in promotions to protect your privacy.
- If you’ve been scammed, change your passwords, freeze your financial accounts, contact official support, and report the incident to the authorities right away.
II. Cryptocurrency Transfer Scams: Hidden Trading Risks
1. How the Scam Works
Transfer scams usually occur in peer-to-peer trades or when trading goods and services. Scammers use various tactics to trick victims into making transfers. Here’s how this scam typically works:
(1) Finding Easy Targets
Scammers hunt for potential victims on social media or crypto platforms. They might post fake high-price buy ads on crypto trading forums to lure in sellers.
(2) Gaining Trust
They build trust with fake payment proofs or showing a keen interest in the goods or services. For example, a scammer might send a genuine-looking bank transfer screenshot, claiming they’ve already sent the money to the seller’s account.
(3) Pressuring for Transfer
They urge the victim to release the cryptocurrency before receiving the payment or ask for extra fees to complete the trade. Scammers might claim that the transfer is processing or that a deposit is needed to ensure the trade goes smoothly.
(4) Disappearing Act
Once the victim makes the transfer, the scammer either reverses the payment or disappears, leaving the victim with a loss.
2. Scam Scenario
User B is selling cryptos on a P2P trading platform. A buyer provides a fake bank transfer receipt, claiming to have sent the money to User B's bank account. The buyer urges User B to release the cryptocurrency immediately, insisting the transfer will go through soon. Trusting the buyer, User B releases the crypto without receiving payment notifications from the bank. A few days later, he finds out the bank transfer was canceled, and the buyer has vanished.
3. Prevention Tips
- Before releasing the cryptos, make sure the funds have actually been credited to your account and be aware of the risk of transfer reversals.
- Verify all receipts and emails carefully to avoid being tricked by forged proofs.
- Use reputable trading platforms and take advantage of security features they offer, such as escrow services.
- Check the identity and reputation of the counterparty to avoid dealing with suspicious account.
III. Tips & Summary
Cryptocurrency scams are always evolving, but you can reduce your risk by staying alert, being aware, and taking the right steps. Here are some extra tips:
- Make it a habit to change your account password regularly and enable two-factor authentication to keep your accounts secure.
- Learn about common scams to better spot them.
- Do thorough research before participating in any cryptocurrency event.
- If you suspect you might be getting scammed, stop all trades immediately and seek professional help.