Fake Cryptocurrency Exchange Alerts

A Cryptocurrency Exchange is a digital currency platform allowing individuals to trade cryptocurrencies with other assets. It does not enjoy the backing of the government. The process speeds up payments by avoiding bank charges. With the government and any other regulated institution in it, it simply means no tax. This makes the exchange vulnerable to scammers. These scammers do it in a way that only those aimed, read and take action. 

Digicash is a form of digital cash that David Chaum introduced. Digicash made a humongous amount of money in a decade. The idea behind this currency was to get rid of the traditional form of currency. More and more cryptocurrencies have been introduced. 

Unlike the traditional form of currencies, these exchanges have no physical coin. The conventional money is produced by the government and brought out to the economy through the bank. The bank tracks all the transactions. But for cryptocurrency, the flow is done with a blockchain that uses a type of sophisticated maths called cryptology. With this, people are easily scammed into sending money. 

Cryptocurrency scammers sites are not blockchain-powered. Scammers do not track the transactions. They also do not have solid business plans that solve real problems. And so the people behind it are fake, they do not exist. People tend to overlook all this; thus, they lose lots of money.

Cryptocurrency Exchange Scams

Because of greed for easy money, people are scammed easily. Scammers make the exchanges look legit. They generate fake cryptocurrency exchanges and make their targeted clients more interested by exaggerating their trading volumes. The value of these exchanges fluctuates so much. It can be high now and low the next minute. At the same time, the scammers trick people by keeping it at an exhilarating rate. |Lots of people are attracted by this. Then all of a sudden value drops.

Fake Bitcoin Exchange 

Bitcoin and ether are the most common cryptocurrencies. Bitcoin investors have been on a rollercoaster ride for such a long time. The value goes up, then it suddenly goes down. With its brevity rise, it has attracted a lot of attention. Most people do not even understand the technology or even how it came to be. But because of the news on early investors who turned thousands into millions, they rushed to invest. At this juncture, scammers take advantage.

The South Korean financial authorities exposed a hideous bitcoin scam in 2017. It was the largest trading exchange that took lots of investors’ money. This exchange took on the real Korean exchange name (KRX). It claimed to have been a creation of the trading board of KRX, KOSDAQ. It made people easily believe in it cause it passed itself to be legit. When people began to report about their money being stolen, the Bitcoin suddenly vanished.

The Big Coin was another type of Bitcoin scam. It was discovered in 2013. It was a digital currency wallet that supposedly allowed merchants to transact with its tokens. Randall Crater was arrested and charged with running a cryptocurrency scam with the big coin. He scammed more than 28 investors over six million dollars. This coin was described as a grand pyramid scheme. 

Crater and two other fraudsters who were operating cryptocurrencies were taken in. They broke so many other commodity exchange rules. They were part of an ongoing investigation into cryptocurrency investment schemes.

Ponzi scheme

Charles Ponzi was another intelligent Italian swindler. Pyramid scheme was his way of scamming people. His crafty ways made this scheme named after him, hence it was called the Ponzi scheme. He started scheming people by buying discounted postal coupons from other countries. Charles later redeemed them in the United States at the face value. He used to pay earlier investors with the money he made from the other investors who came in later. Ponzi did not invent this fraudulent Ponzi scheme, but it was so identified with him.

Bernie Madoff

Bernie Madoff was another pyramid schemer. Madoff was the one who performed the largest pyramid scheme in history. He ripped off tens of billions from a countless number of people in at least 17 years. Bernie was arrested and charged with money laundering, security fraud, and so many other felonies. He was serving a 150-year sentence when he passed away on the 14th of April 2021.

The men who operated the Bitclub network were also arrested in the year 2019. They asked for money from investors in exchange for shares of cryptocurrency mining. Just like any other pyramid scheme, old investors were only rewarded after recruiting new investors. In the end, so many investors did not get returns on their investments.

Britain and Netherlands joined forces and did an investigation on cryptocurrency scams. It led to six people arrested for creating fake cryptocurrency exchanges. It hoaxed more than four thousand victims in 12 different countries out of over $27 million.

With the modern world of new technology, there are so many other cryptocurrencies. Scammers have discovered new ways of scamming people. They create fake websites or even hack into a genuine account by accessing the bitcoin wallet. They access the wallet using a sham URL that relies on domain errors entered by a user. It, therefore, makes the website look so legit, so victims easily fall into the trap. The fake website has a minor detail different from the original exchange website.   

Identifying fake cryptocurrency exchange 

First, always remember that when the deal is too good, think twice. If an exchange promises extravagant returns in just a few days of investing, be sure that it is fake.

Whenever you are promised free money, know that it is a scam. We should never accept free things because they turn out to be very costly.

Scammers always avoid giving details or explanations on what they are really doing. They mention the juicy part that makes you overlook the details. 

Legit exchanges will not pressure you into making manifold investments. But scammers will call, text, email, and do all sorts of things to pressure you.

Some ask for very high registration fees that they had failed to mention while introducing you to it.

Others call and ask you to make payments for a particular registered cryptocurrency exchange and pose as their agents.  

Cryptocurrencies that have a good reputation, a good website, and verified employees are what investors should go for. 

They should also be very careful while typing to avoid a typographical error. Research well about the cryptocurrency exchange before creating an account. Research thoroughly and make sure it is legit. 

Be very careful when a merchant insists on some payment options. They likely want to scam you.

Let us all always be conscious of these scammers. And remember that is a very cruel world that we live in, no one looks out for the other. 

Conclusion

Fake cryptocurrencies are being created every other day. Aiming at enticing potential investors and fleecing them of their money. 

We should always be extra conscious. Never rush to investments.

Take time and get to know more about the exchanges and only go for reputable ones.  

We should also learn to denote signs of fake websites before opening an account.

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