The crypto markets are becoming more and more mature, but unfortunately there are still numerous fraudsters who are after your valuable assets Bitcoin (BTC)Ethereum (ETH) or other cryptocurrencies. Criminals seem to find new ways to trick investors every day. In this article we present five of the most common scams.
Losing your entire crypto portfolio is probably the worst scenario imaginable. Luckily, you can protect yourself against online threats and criminals’ tricks with a VPN.
Crypto scams and how to protect yourself
Crypto scams come in various forms, but the most common are phishing attacks. Maybe you already have one of these Crypto News-area belongs. Criminals try to obtain sensitive information such as the private keys of your wallet or login details for crypto exchanges. To do this, they use fake emails, websites or messages that are difficult to distinguish from real ones.
For example, earlier this year, Trezor, a popular hardware wallet manufacturer, had its customer service hacked. Personal data from tens of thousands of customers fell into the hands of the attackers and was used in a large-scale phishing attack. The goal was to obtain the wallet recovery phrases. Many users lost theirs Cryptocurrencies. Users could have protected themselves better with a VPN. The Alternative ID feature allows you to mask your online identity with a new email address, so your real data doesn’t fall into the wrong hands.
Another example occurred a few months ago when a former CEO of a crypto project lost $450,000 after connecting to a friend’s WiFi. This network had been intentionally compromised, allowing the attacker to gain access to the CEO’s wallet. This type of attack is called Man in the Middleattack (MITM). This could have been avoided with a VPN because all data sent is encrypted. This means that third parties cannot view or intercept them, and you can remain securely connected to any WiFi network.
Pyramid schemes: a popular scam
Pyramid schemes also remain a common method used by criminals to defraud crypto investors of their money. A well-known example is BitConnect, a fraudulent platform that lured investors in 2017 with the promise of high returns. In fact, the payouts to early investors were funded by new participants. When the influx of new investors stopped, the system collapsed and all investors lost their money. The lesson: If something sounds too good to be true, it usually is.
Crypto security and privacy
A VPN also hides your IP address. Your internet traffic is redirected through anonymous servers, keeping your crypto transactions private and secure. At the same time, you can access platforms that may not be available in your country.