Cryptocurrency trading is the number one topic for the 21st century. The amount of investments worldwide is increasing at a rapid pace, as Bitcoin, Litecoin, Ethereum drive the market.
Banks are going digital, and an increasing number of countries are switching to cashless systems. If done correctly, crypto-trading offers the key to financial freedom, but if the right security measures are not taken, traders can be tricked and scammed out of their money.
It’s important to go into trading with a clear understanding of what precautions to take.
Crypto-currency websites that look legitimate may turn out to be fake. A case has been brought to court against IQ Option and its CEO Anton Rabinovich, a multi-national trading platform. The case shows that crypto-fraud can be prevented as legislation is put in place to protect traders. The problem is, the topic is so recent that many countries have not yet developed the right legislation. As one of the first cases of crypto-fraud in India held in Supreme court, this case will be instrumental in paving the way for trader protection.
So how can we stay safe while trading online?
- Read a range of user reviews, and choose your trading platform wisely. Hundreds of users have complained about losing their money through IQ Option, so their reviews can serve as a warning to any potential traders.
- Research potential trading platforms. Websites such as IQ Option create appealing websites but turn out to , but independent websites can tell the full story. Make sure they are blockchain-powered, as they will provide security by tracking transactions. Make sure there are real people behind them that can be contacted if needed.
- Check your computer’s antivirus and make sure it is up to date. Avoid downloading suspicious files.
- Don’t keep the passwords for your crypto wallet in the cloud—or anywhere online. They can too easily be hacked into and stolen.
- Use a VPN to ensure a secure connection.
- Be alert for fake websites. If the site does not have a small lock icon on the left side of the url and no https in the address, it could be a fake. A number of websites have been set up to resemble valid companies, and may look convincing. Attackers can also divert payments to another site that looks identical, except for a tiny change. For example, while directed to a payment page, a page opens with a zero instead of an o that. To prevent this, ensure that you copy and paste the exact url into your browser.
- Avoid email scams. They’re a popular method, and offer online chain referral schemes or new investment opportunities that turn out to be false. NEVER click on a link in a crypto email.
- Recognise fraudulent offers. Be wary of messages that ask you to pay with Bitcoin, as they are likely to be scams. If you are asked to make a small payment using crypto-currency, you will mostly likely not get it back. If you are given guarantees of making money or doubling your money quickly, they are probably false. Offers of free money are one of the surest signs that something is fishy.
Overall, the most important things to do to avoid crypto scams are to research potential platforms, secure your computer, recognise and avoid fraudulent offers.