How to Spot a Crypto Scam

How to Spot a Crypto Scam

(Hans Eiskonen/Unsplash)

You’ve seen it before: A site that promises instant returns on your small crypto investment.

It looks legitimate with all the happy customer testimonials, FOMO-inducing promises and easy-to-use dashboards that look like so many other financial sites. The language is open, breezy but sometimes, well, odd.

One site, Coindeskminers.com especially piqued our interest because it used a derivative of our brand without our knowledge, much less consent.

“They say money doesn’t grow from the ground, well it does with crypto currencies [sic] because at Coindesk Miners we have assembled a group of world-class engineering, strategic cryptocurrency mining and investment logic growing investments and making profits for both parties,” the website says. The promise is simple: You submit a little cryptocurrency, as little as $5, and you’ll get instant returns. And it implies a nonexistent connection to CoinDesk, the world’s premiere crypto news site.

Too bad it’s all a scam.

And, sadly, not everyone can tell.

In the past few months, CoinDesk has received multiple messages from users – including some retirees – who have dumped thousands of dollars worth of crypto into these sites. Further, Reddit is full of examples of savvy users being duped by get-rich-quick schemes. The site we’re exploring today, Coindeskminers.com – we aren’t linking to it but we want you to be aware of the name – is just one of many we’ve seen over the years.

The trick often runs like an scam – think the Nigerian prince who wants to give you millions but needs a few thousand dollars to complete the paperwork – with a sad twist.

Because cryptocurrencies cannot be returned (unless the recipient chooses to) and your bank can’t step in to prevent a transaction, the scam begins with you losing your “investment” instantly. Any money you send to this site is gone. Then, after the scammers show you the amazing profits you’ve made on your money, they ask for more money to pay for “fees,” essentially forcing you to pay up in the hopes of gaining your cash and fake profits back. Then the scammers disappear.

Let’s explore the world of scam sites and talk about what you can do to stay safe.

The first step before using any crypto site is to reach out to a knowledgable third party. This could include posting on a Reddit cryptocurrency forum (where ) or asking a computer-savvy friend about the site. Further, if you have any questions, feel free to reach out regarding crypto and crypto scams.

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