If you make financial transitions online then you have likely heard of Cryptocurrency. Cryptocurrency, such as Bitcoin and Ethereum, is a relatively new method of online payment. What makes Cryptocurrency different from other methods of payment is the additional levels of security involved, however, it’s important to understand how Cryptocurrency works, and how to identify legitimate providers before investing in them. In this guide, we’ll explore what Cryptocurrency is and how to keep yourself protected when making use of it.
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What is Cryptocurrency?
Cryptocurrency is, as the name would suggest, any kind of currency that exists virtually and doesn’t rely on banks to make transactions. This means that transactions are encrypted and stored on huge digital databases which use something called blockchain technology to make data incredibly difficult for hackers to get a hold of. This keeps funds much safer than they would be when put through traditional transactions with a bank.
Although, with the large amount of cryptocurrencies available, it can be overwhelming to decide which is the best for you. One thing to consider is crypto with 1000x potential which are high-potential cryptocurrencies that have a high chance of multiplying your investments.
The Risks and How to Protect Yourself From Them
Unfortunately, as the popularity of cryptocurrency has evolved, so has the activity of criminals setting up scams in order to profit. Let’s go through four of the main scams and look at how we can avoid falling into their traps.
1. Investment Scams
One thing to be cautious of is companies assuring you that you can invest in them to ‘make money fast. These companies are likely to approach you, seemingly out of nowhere, with promises to help you make money ‘risk free.’ ’ Be aware of scam calls, texts or emails from companies asking you to invest cryptocurrency with them directly, the chances of these all being scams are incredibly high.
2. Romance scams
There are countless online dating sites out there, many which can be very beneficial for individuals looking to find like-minded people to share their time with, but these websites can also be breeding-grounds for scams and this is no different when it comes to investing with cryptocurrency. If anyone approaches you on a dating app, asking you to invest in anything using cryptocurrency, it is safe to assume this is a scam. Ask yourself why any legitimate and good-natured person would offer ‘investment advice’ on a dating app and use caution if these kinds of topics are brought up.
3. Celebrity Scams
Many scammers pretend to be celebrities or billionaires who approach individuals with promises to multiply any investments made to them with cryptocurrency. If you were to send this money, it would be stolen, and because there is not the same legal security on cryptocurrency as there is on regular transactions with the support of banks, you may not get it back. It is safe to assume if anyone unknown to you approaches you with tantalizing promises to ‘make you money fast’ then this is a scam.
4. Businesses Demanding Payment in Cryptocurrency
No legitimate business will insist that you make a payment to them in cryptocurrency. There is no requirement to use cryptocurrency to make any kind of transaction. If a business insists crypto is the only way to pay, do not follow through with the purchase. It is safe to say this is a scam, and whatever you are purchasing likely does not exist.
