The Possibility to Waste Your Time and Money

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Many of the people who are not related to cryptocurrencies are lurking on the web in a search for free Bitcoins. Numerous casinos, betting clubs, cryptocurrency hedge funds, and other websites lure people in. How do you know that the casino is working well? Where will you gather precise information about a faucet or a lottery website that promises to send you a ton of coins?

Do Not Waste Your Time

Do you know one precious asset that is not gold, not fiat money, not cryptocurrency, and not a bond, obligation, or a stock? This asset is very rare, and if you lose a piece of it, you’ll never regain. Correct – we are talking about time. Be extremely aware that even respectful corporations can advertise scammers.

Many of the industry participants will try to use you to enrich themselves. If you look for a job in the crypto company, make sure that you spent at least 1 month reading the news pieces and reports about the CEO and the company itself. Check the Glassdoor and Trustpilot reviews. See their forums pages and what the others are writing about the company. Find as much information as you can, and if something looks fishy, consider what you can do with it and act accordingly. And don’t waste your time on faucets, ad platforms, different retweet services. They promise free Bitcoins, pay you satoshis for doing absolute nonsense and sometimes drop malware, miners or viruses onto your PC.

Danger! Crypto Payments Are Irreversible

The main component of cryptocurrency fraud is that all the payments in such systems are irreversible. You won’t be able to ”chargeback the scumbag” in two months after the credit card payment. My colleague bought a knife over the Internet and the knife wasn’t as good as he expected. So he made a chargeback.

In cryptocurrencies, you won’t be able to call the bank to charge it back. The money you send will vanish forever. You will only have one chance to spend your crypto coins, and it’s better to be a good chance. 

Some people who use Bitcoin like usual money, lose some benefits. It’s cool to pay for VPN services or mobile subscriptions with Bitcoin or Ethereum. But also, it is crucial to remember that those coins will never get back to you like the paper fiat bills could do.

So if your VPN subscription plan costs 0.03 BTC, consider saving the coins to a separate wallet. If you still want the VPN subscription, simply pay with a bank card. Fiat money is worthless and it’s not bad if you spend them across the Web instead of spending precious coins.

Search Engines Advertise ICO Idiots and Other Freaks

Photo: QuoteInspector

Just look at what the American Google puts in the ads section for the ‘bitcoin’ or ‘cryptocurrency’ keywords. The search giant who knows everything about the tricky field puts out advertisements for obvious scams. 

The inexperienced users are getting lured into shady projects like OneCoin or Karatbars. They think that they are participating in the crypto revolution. That they are cyberpunks and ‘hodlers’. And that banks are ‘in the stove’. While in reality, they are just sitting all day near PC and stare at the shitcoin prices. At the same time, someone else is spending their bitcoins (given in exchange for shitcoins during an ICO round).

Google can post the advertising for a company that says: If you send us 0.1 BTC, we would double the coins in 24 hours! Or, they can write something claiming that’s advice from a famous Hollywood star. Then, this company is stealing your coins and not giving any returns, and the cops cannot help.

The company that is called ”The Russian Google” – Yandex – is posting the advertising of scam companies in Russia. Unbelievable, the search engines earn billions on personal data, the e-mail users, their actions. However, if you read Telegram channels such as Vklader, it appears that Rusian Google gives as many scammer ads as the original Google. So, it is not some kind of virus that sits in one company. No, this is a very old disease called avidity which we see here eating the ‘successful collectives’ across the globe.

People Get Scammed over Telegram Chats

Sometimes, you are sitting in the crypto-related Telegram chat, and someone pretending to be the Admin of the chat offers you free bitcoins. The offer may be different, but the essence of it is always the same – you can gain lots of cash in no time. But you need to send out some Bitcoin or Ethereum first. They always need some trusted deposit or starting payment, with the cheaters using social engineering to target your naivety.

The main strategy is to seduce you to send out the payment by playing on the greed. The fraudulent offer often looks too legit and too shiny. They have an official website, and there are over 15K Twitter followers. Their YouTube channel is full of vids of beautiful, smart people in offices. Everybody in the office keeps an active and happy mood… as if they’re working on a drug baron.

How could this be a scam? However, the experienced cryptocurrency journalists are falling victims to fraudsters and crooks of different sizes. The authors of pieces like this one, despite writing many articles describing shady financial schemes, are getting into different shitty stories in their life too. Even the man who can spot ICO shitcoiner with his eyes closed could fail in a simple talk with bazaar’s gypsy merchant.

Never Enter Your Addresses, Public Keys, Private Keys on Websites and Forums

The issue here is that many people have to spend years studying cryptography before they start understanding why posting your keys and even the addresses on the public is a bad idea. So, the main part of any cryptocurrency wallet is the private keys storage. The wallet must encrypt the wallet file with the user’s password or by using some math technique. Private keys are living within the wallet file and generate the public addresses. The private key allows you to spend Bitcoins (or altcoins) from a corresponding address.

A crypto wallet is a key-chain. You have multiple keys from multiple crypto addresses. Each time the user receives coins on one of the addresses, he can spend them using the private key. The special SEED mnemonic phrase of 12 or 24 English words is generating all the keys.

Some of the online experts advise using online resources to check the private keys from addresses. People check the privkeys and facilitate online derivation tools to obtain freshly backed fork coins. Sometimes, after a hardfork of a coin, the new coins are born. If the coin within your portfolio gives birth to a fork coin, then you can get richer by doing nothing. Never use online websites to check anything related to your coins.

If you post the private key online, there’s a chance that some hackers gain access to it. Furthermore, when you post your public key somewhere, if the hackers will find several of your addresses, they will be able to mathematically generate some of the private keys based on your addresses and public keys.

If you don’t understand what the hell this all means, just remember that you should not post any address related keys or other information online. The only thing you can post safely is the Transaction hash or the ID. It is useful for proving that the transaction takes place. Folks use ID to identify the TX in online blockchain explorers.

Jeff Fawkes
Author: Jeff Fawkes

Jeff Fawkes is a seasoned investment professional and a crypto analyst covering the blockchain space. He has a dual degree in Business Administration and Creative Writing and is passionate when it comes to how technology impacts our society.