The 5 most common Bitcoin scams and how to avoid them

There are many types of cryptocurrency scams in the blockchain industry. Some of the most common scams include blackmail, fake exchanges, fake giveaways, phishing emails, copy-and-paste malware, pyramid schemes and Ponzi schemes.

They are all briefly discussed below, so you can learn how to avoid these Bitcoin scams to keep your cryptocurrencies safe.


Blackmail is a well-known method used by scammers where they threaten to put sensitive information about you online unless paid. This payment is usually requested in the form of Bitcoin or other cryptocurrencies.

Scammers can use blackmail if they find or fabricate sensitive information about you, after which they exploit that information by putting you in a position of powerlessness and then ask for Bitcoin or other forms of money in return.

The best way to avoid this scam is to be careful about choosing your login credentials, which sites you visit, and who you give personal information to. It's also smart to always use two-factor authentication when possible. If the information you are being blackmailed with is not real, and you know it, then there is little to worry about.

Fake exchanges

Fake exchanges are fraudulent copies of legit crypto exchanges. These is usually found in the form of a mobile app, but you can also find them as desktop apps or fake websites. The deceitful thing about this is that many of these fake exchanges are very similar to the real ones. At first glance, they seem legitimate, but their goal is to steal your money.

These fake exchanges usually lure their new victims by offering free cryptocurrencies, low prices, and even gifts.

The best way to avoid this scam is to bookmark the real URL of an exchange and always double-check the URL before logging in. For mobile apps, it is recommended to always look at information about the developer, amount of downloads, reviews and comments.

Fake giveaways

Fake giveaways are a scam where your cryptocurrencies are stolen by somebody offering something for free in exchange for a small deposit. Generally, scammers do this by asking you to send Bitcoin to their address after which you will be refunded more Bitcoin (e.g. "send 0.2 BTC and get 0.5 BTC back"). But if you complete this transaction, neither the initial amount nor the bonus amount will ever be refunded to you.

There are many variants of fake giveaway scams. Instead of BTC, some scammers ask for other cryptocurrencies such as ETH, DOT, LINK and many more.

Many of these fake giveaways can be found on Twitter and other social media platforms, where scammers comment on a popular tweet, viral news or announcements. These reactions are widely read and as a result many people fall victim to this scam.

The best way to avoid this form of scam is to never participate in awards where you must first send something of value. Legitimate giveaways never ask for money first.

Phishing emails

There are several ways of phishing. One of the most famous is sending phishing emails where you are cleverly tricked into downloading a virus file or clicking on a link to a malicious site that looks like a legitimate site. These emails are especially dangerous when they imitate a product or service that you often use.

Such an email often consists of a warning that you must quickly protect your account or your money against hackers. They may ask you to update your account information, change your password or upload documents. Scammers often try to get hold of your login details in order to hack your account.

The best way to avoid this scam is to check if the emails are from the original sender. When in doubt, you can always contact the company in question to confirm that the email you received was actually theirs. You can also hover over the email link with your mouse (without clicking the link) to see if the URL contains spelling errors, unusual characters, or other irregularities.

Pyramid schemes and Ponzi schemes

Pyramid schemes and Ponzi schemes are two of the oldest forms of financial fraud. A Ponzi scheme is an investment strategy that pays out profits to old investors with the money of new investors. When the scammer doesn't manage to bring in new money, the money stops rolling and it all collapses. OneCoin was a good example of a Ponzi scheme.

A pyramid scheme is a business model that pays its members based on how many new members they bring in. When no more new members join, the money again stops rolling, and it all collapses.

The best way to avoid this form of scam is to do proper research on the cryptocurrencies you purchase. If the value of a cryptocurrency depends solely on the entry of new investors or members, then you have probably found a Ponzi scheme or pyramid scheme.