What you need to know about Bitcoin and scams

By Brandstories Time of article published May 24, 2021

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Perhaps, you’ve heard people talk about Bitcoin, and you don’t know much about it. Well, you’re not the only one. Before investing or using Bitcoin, take your time to learn about it.

Essentially, find out what makes Bitcoin different from fiat money and why not all retailers accept Bitcoin as a payment method.

What is Bitcoin?

Bitcoin refers to a virtual currency. That means this currency exists electronically and not available in physical form. However, people use it to pay for services online. What’s more, you can use a platform like the Bitcoin Era to purchase and sell Bitcoin. Thus, you can sell your Bitcoin to get fiat money.

People exchange Bitcoin with other users online using a computer or phone. Essentially, Bitcoin transactions do not involve intermediaries like banks. Although Bitcoin is the most know cryptocurrency, other digital currencies like Ether exist.

How to get and use Bitcoin

Most people get cryptocurrency by purchasing it online. Crypto exchanges are platforms where people buy and sell Bitcoin. However, some people mine Bitcoin. And this process entails investing in advanced computers. Also, you need skills to solve complex mathematical puzzles to earn Bitcoin.

Once you’ve received Bitcoin, you can use it to complete quick payments online. This cryptocurrency is also ideal for people that want to avoid high transaction fees. Ideally, Bitcoin transactions do not attract hefty fees because they do not involve intermediaries like banks.

What’s more, you can use Bitcoin if you need anonymity. That’s because Bitcoin transactions do not ask you to disclose information like your name and ID number.

How to store Bitcoin

People store Bitcoin in digital wallets. A digital wallet can be on a computer, online, or a hard drive. If a crypto exchange goes out of business, you lose your digital wallet password, you send Bitcoin to the wrong address, or somebody steals your digital wallet, you can lose your money.

And nobody will help you in your recovery attempt. That’s because you transfer money directly without involving an intermediary, and you don’t have an entity to turn to for assistance.

How to avoid Bitcoin scams

Many scammers want to find new ways to rob unsuspecting Bitcoin users. A common sign of a Bitcoin scam is when somebody insists you use Bitcoin to pay for a service or product. If somebody asks you to pay by gift card, wire transfer, or cryptocurrency, it could be a scammer.

And you might not get your money back after paying, and then you think otherwise. Other Bitcoin scams include:

  • A company that promises huge earnings within a short time to realize financial freedom.
  • A company tells you to use Bitcoin to pay for membership and then start recruiting others into their program. However, you can’t withdraw your Bitcoin even after paying and recruiting others.
  • A firm that gives unsolicited offers from “investment managers.” Such companies promise to assist you in growing your money. However, you must pay with Bitcoin, yet you can’t withdraw the funds in your account with them.
  • A company giving unsolicited job offer as a way to sell Bitcoin, recruit investors, mine Bitcoin, or help you convert fiat money into Bitcoin.
  • A scammer can also list several scam jobs and promise a job you have to pay an upfront fee with Bitcoin.

Most scammers promise you they will make you a lot of money once you do what they ask you. Others guarantee you big payouts or even double the amount you invest with them. However, all these are lies, and you end up losing your money. So, before investing or sending anybody your Bitcoin, do some due diligence.

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