Cryptocurrency Scams: Most Popular Fraud Schemes

Transactions involving the buying and selling of bitcoins are fast, have no clear boundaries, and are irreversible. Undoubtedly, these qualities attract investors, but not only them. With the increasing popularity of cryptocurrency exchanges, scammers are showing more interest in them. They build Bitcoin pyramids and create scam wallets. reveals the current methods of digital fraud and measures that will help protect yourself from dishonest practices. Remember, forewarned is forearmed!

Why does Bitcoin attract scammers?

The problem of attractiveness for scammers lies in the nature of digital currency. It's quite simple: investors can conduct financial transactions anonymously, but when it comes to buying and selling cryptocurrency, there is no mechanism for refunding payments.

In this case, bitcoin transactions can be considered as cash payments. Unfortunately, canceling or refunding a digital payment is impossible. This feature is only available to users with bank accounts.

According to a study by the Southern Methodist University in Texas, over the last 5 years (the time when digital currency became relevant), crypto investors have lost $11 million due to fraudulent operations.

Cryptocurrency Scams

Bitcoin Pyramid

Newbie investors are primarily lured in by promises of high and quick profits, as well as low capital investment. This «tandem» is the main sign of a fraudulent scheme.

High income and minimal costs – this is exactly how classical financial pyramids operate. The initial investors attract a large number of people and make a profit from their investments. The scheme collapses when the flow of investors decreases. Only the organizers remain with the money. Bitcoin pyramids are no exception. They operate on the same principle: attracting people and asking them to invest funds.

You can recognize a Bitcoin pyramid by these signs:

  • organizers predict a high percentage of profit in the shortest time;
  • they guarantee that «losing money is impossible» and «you will always remain with a profit»;
  • they use psychological pressure, urging with phrases like: «you need to invest as early as possible, otherwise you won't make it»;
  • there is no reliable information or reviews about the company and its owners online;
  • withdrawal of funds is difficult, requiring unusual operations;
  • there is an abundance of advertising on social networks, suggesting registration with large bonuses through links.


Perhaps all investors (not just cryptocurrency ones) know the nasty word «scam». In English, it has many meanings, but in this case, we mean «fraud».

In the crypto world, a scam is an investment scam project. Fraudsters, wanting to make easy money, develop some conditional token or token sale, attract investors, and then, having collected a significant amount, shut down their supposedly operational activity.

Most often, startups – Bitcoin exchanges or initial coin offerings (ICOs) become scams. Scams can also masquerade as websites, Bitcoin wallets, cryptocurrency exchanges, or all of the above simultaneously. Initially, they operate normally, may even pay out money or credit bonuses to the personal account. This is done to lull vigilance and gain the trust of newcomers, encouraging them to be even more active. Well, who doesn't want quick money? When an investor deposits a significant amount of bitcoins into the account, accumulates coins, the scammers disappear. Many have suffered from this scheme.

You can recognize scams by these signs:

  • the company has dubious registration;
  • the identities of employees or owners are unknown, and it is impossible to contact the administrator;
  • there is no information about the structure on social networks or forums;
  • the company positions itself as new and anonymous.

Remember, easy money doesn't exist. Don't chase after dubious buying and selling of cryptocurrency.