Johannesburg - Despite the erratic fluctuation in the price of the world's top cryptocurrencies, usage uptake has surged, creating a pecking order of unsuspecting victims for scammers.
While the world's most popular crypto, Bitcoin, is facing an all-time low, all virtual currencies remain unaffected by the trends of traditional money.
Coupled with the anonymity and traceability of their deregulation, cryptocurrencies have become a convenience for scammers to receive funds after successfully luring their victims.
It's a given that the veil of secrecy provided by deregulated currencies thus becomes a double-edged sword, with the positives behind transactions, like immediate international payments and sidestepping the fees attached to them, contrasting to the vulnerability of users.
How cryptocurrencies work
The first cryptocurrency, Bitcoin, in a nutshell, is based on a white paper written by an unknown author in 2008 and which was used the following year.
The cryptocurrency reached an all-time high of R1 129 843 in November 2021 but was worth R326 004 at the time of publishing, attesting to its turbulent volatility, given its introductory value of just a few cents.
Since its creation, Bitcoin has been followed up by thousands of new cryptocurrencies. New ones are created frequently, with varying values and purposes.
It has also become easier to buy cryptocurrencies through numerous trading platforms available to South Africans.
How crypto scams work
Scammers have hatched elaborate methods and smart tactics to entice their victims, each becoming more unique and communicating on various platforms.
Meanwhile, accessibility to victims by scammers is more prevalent with the advent of instant messaging and social media, seen with scams through Facebook and WhatsApp. This makes it more difficult to identify potential scams.
There are several methods to remain safe from cryptocurrency scammers.
While their tactics might change, the goal of cryptocurrency scammers, setting them apart from other cybercriminals and scammers, is that their goal is to entice their victims into paying them in cryptocurrency. The payment cannot be traced or reversed. Once payment has been made to a scammer, their job is done, and victims will probably never be able to communicate with them again.
How to avoid potential cryptocurrency scams
Some other elaborate schemes by scammers often involve phishing and Ponzi or pyramid schemes. As with typical scams, it is important to identify one that often sounds too good to be true.
More intricately designed cryptocurrency scams are often backed or supported by fake websites, which seem legitimate and offered to victims by a scammer as a means of validation and to earn their victims' trust. Look out for inconsistent text or images on these websites.
No financial institution or legitimate investment opportunity will have poorly designed web pages. However, well-designed sites cannot promise authenticity, especially if they only transact in cryptocurrency.
Never provide personal information or payment to anyone who offers an investment opportunity solely in cryptocurrency without researching the company.
Google can be useful, especially for reviews on potential investments.
Most investment opportunities that transact exclusively in cryptocurrency claim to transact in this method for instant transfers and to avoid fees, bypassing regulations. These are most likely scams.
Enable two-step authentication for cryptocurrency websites you might make use of. Almost all cryptocurrency trading platforms offer a two-step authentication option by either an authenticator app or via an emailed or SMSed code, normally required after successfully verifying login information.
IOL Tech