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Avoiding сrypto scams in 2024

Despite regulations, the crypto space still attracts scammers with fake investment offers. If you've been defrauded, contact us for help recovering your losses and avoiding future scams.

What is cryptocurrency?

Cryptocurrency indeed is an interesting asset class, and at the same time depends a lot of speculation. Most importantly, the cryptocurrency universe boast of significant returns on capital invested, especially in the case of bitcoin. Bitcoin was created notably in the cold period of the Great Global Financial Crisis as an answer to the problem of relying too much on foreign exchange. This Fibonacci style approach is similar to Bitcoin which Wikipedia suggests is

Common Binary Option Types

  • Bitcoin

    Bitcoin is the first cryptocurrency that comes to the mind of everyone, and it is widely embraced by almost all of the financial service companies. The Bitcoin market share usually accounts for around 55-65% of the total market capitalisation of all cryptocurrencies that exists. In the month of December 2017 Bitcoin achieved yet another significant milestone as the first ever Bitcoin Futures contract was launched in CBOE and CME exchanges. A significant turning point came in July of the year 2020, when the US OCC regulated all chartered banks to offer custodial services for all kinds of cryptographic currencies, which enhanced the investment status of Bitcoin.

  • Ripple

    Between the years of 2018 and 2020, Ripple was also described as the answer to the SWIFT payment system. However, it was not long before it was embroiled with legal problems instigated by the US SEC which considered it an illegal activity in regard to securities offerings. Curtis, Reuben and Michael state that the company in 2018 Image Credit: Curtis, Reuben and Michael interviewed Ripple Global Inc. coworkers and Unsafe Avalanche turned that already illegal currency in excess into clear-cut virtual currency scams. In addressing those risks, Internal Control Systems comprising of issuers policies and procedures are usually in place.

  • Etherium

    Still, Ethereum is the first derived from Bitcoin and having overtaken its predecessor, controls a large chunk of the cryptocurrency market. It is referred to as the foremost 'altcoin' because it serves not just as a mode cherished cryptography value but also supports the development of other forms of currencies through smart contracts. While Bitcoin’s primary use case centers on being a means of value storage, Ethereum has been able to develop a steered distributed network. In February 2021, Ethereum became the first ever cryptographic asset to go public and offer trading in futures contracts, maneuvered through a much smaller volume, whose market size is approximately a fraction of Bitcoin’s.

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Key Points

Cryptocurrencies are emerging as a new class of asset-a promising class of investment, but very risky. Caution forms the very guiding peg in cryptocurrencies, where promises of quick wealth have become clamorous. Thorough research and due diligence shall be done, including wallet verification, website verification, and information sources. Equally important, it is not advisable to invest more than one can afford to lose. The more informed and watchful one stays, the fewer the risks and better decisions one can make in this erratic market.

  • Is cryptocurrency dangerous?

Investing in cryptocurrencies is like the Wild West-things tend to be unpredictable. It is required to do research on the platform one wants to join, and prefer those with some sort of regulations. Since 2020, some reputable platforms for cryptocurrency have been built up; they are Coinbase, Bitstamp, Kraken, Binance, and Bittrex. Recommendations are important, but it's necessary to do your own research and keep your guard up against some services looking to harm your investments.

  • Bitcoin mining scams

Miners are quite important for the issuance of Bitcoins; they have to solve very complex mathematical problems using high computational power, which, in turn, helps to prevent double-spending or fraud. Yet, mining scams abound, promising passive income through various mining projects. Newer blockchain technologies, such as Cardano, made from a staking system that is reputedly much less power and infrastructure-intensive. Staking is easier and far more accessible to achieve passive income than expensive mining.

  • Bitcoin wallet scams

Bitcoin is held in digital wallets; each has a private key, utilized for transactions, and a public key, for receiving funds. Unfortunately, wallet scams are common, mainly targeting new people entering the market. A scammer might commend certain fake wallets to users, request them to transfer funds, or ask for private keys. It is important not to ever share your private key and to use only well-reputed wallets to keep your assets safe from theft.

  • Pump and Dump scams

Pump and dump schemes have been common in cryptocurrency, mirroring fraudulent tactics seen in stock markets. In such a case, bad actors buy large quantities of an altcoin and create buying frenzy through manipulated news, usually on social media. Then they sell their holdings at inflated prices, leaving behind unsuspecting investors with worthless (or devalued) assets. Always approach sudden spikes with skepticism, do your research, and only invest in projects that have substance to their founding.

  • Pyramid Schemes

OneCoin is one of those notorious examples in a pyramid scheme related to cryptocurrency, promising high returns and actually being complete fraud. Participants were called to invest, while returns came from new investments, not from some legitimate profit. Such schemes can't maintain the payouts without recruiting new members, which basically is a signal for alarm to a potential investor. Always be cautious and do some preliminary research before investing, especially when a project promises guaranteed high yields that are not really feasible.

  • ICO Scams/Exit Scams

Initial Coin Offerings, or ICOs, were a stock-market-like IPO for cryptocurrency projects. While many were legit, others were exit scams wherein the creators took the money and disappeared when the coin's price peaked. The market has matured a bit since then, but such scams can still happen. Always check if the project is legitimate, and if they promise really high returns, research the ICO well before investing.

  • High-Interest Return Scams

The rise of decentralized finance (DeFi) has brought high-interest opportunities, with platforms offering returns on crypto holdings. While some DeFi projects are legitimate, others promise unrealistic returns that might signal a scam. Be cautious of platforms offering exceptionally high yields, and understand the terms and conditions before investing. Conducting due diligence and staying informed will help ensure your funds are safe in the DeFi space.

  • Cryptocurrency Exchange Scams

As cryptocurrency exchanges proliferated, so did the dangers of being scammed or experiencing security breaches. Some phony exchanges convince users to deposit funds and disappear, while others inflate trading volumes to appear more liquid than they truly are. This also includes the notable 2014 Mt. Gox hack, in which 850,000 Bitcoins were stolen. When using an exchange, always check its background to ensure it is a legitimate one; prioritize its security features and know about past incidents, if any, to safeguard your investments.

Common Binary Option Types

  • Make use of trustworthy and controlled cryptocurrency platforms in order to prevent any compromises in fraud and security. These sections are trustworthy, adhered to the industry's needs, and made it possible to engage in trade without any risks. Regulated exchanges allow you to invest and trade conveniently without any threats to your investment.
  • Protect the finances by validating the claims of the sites and background of the people behind the digital currencies projects. Refrain from any ambiguous statements and be cautioned the over-pretentious designs. When assessing the level of trust of a project, let the first place be taken by the details and sense instead of the visual design.
  • Before making any investments in cryptocurrencies, contact the professionals and the financial advisers. This ensures that decisions are made carefully on such volatile markets as the one of crypto currencies with his or her consulting services on possible investment opportunities.
  • Do not get comfortable with the idea of having your assets in cryptocurrencies on an exchange for a long time. To risk manage oneself is good, however, this is not the best way of keeping assets for the future. Instead, consider purchasing a cold-storage hardware wallet to keep your assets safe from possible hackers because exchanges are without a doubt going to get hacked sooner or later.
  • The “get-rich-quick” mentality should be avoided especially with regard to cryptocurrency investments. Do not believe hypothetical claims about winning results or winning money within a short period of time. In place of that, research and let the people you trust guide you and ultimately take action in a way you will not put yourself at risk of being scammed or having expectations that are not realistic.
  • Check if the exchange is based in a jurisdiction that affords appropriate regulations, licensing, and deposit protection schemes against loss or theft. Legitimate exchanges will have insurance, and they will keep the bitcoins in digital wallets that are stored offline in cold storage. Also, in case you trade binary options, check the broker's information on your own, and look out for unusual movements in prices close to expiration times.

Fall prey to a cryptocurrency scam? How you can get your money back

If you’ve been the victim of cryptocurrency or bitcoin scams, don’t be disheartened. Due to the vast number of scams and the number of people hurt over the past five years, regulators worldwide have set their sites on any hint of impropriety in the crypto space. And take comfort in knowing that many people have recovered Bitcoin and other cryptocurrencies – nothing is truly anonymous. A great first step is to utilize our fund recovery company: Ontario-Recovery, by filling out our contact request form. We will assign someone to your case who will work with you throughout this challenging process and try every possible method to get your money back. Check out the testimonials and reviews for yourself – we have an industry-leading track record.