Scammers on Instagram
A group of three individuals from Puerto Rico are peddling the PEMCO wallet, which promises to pay users bitcoin once their wallet reaches 10,000. It is, in fact, a pyramid scheme disguised as a cryptocurrency startup. If you click on this Instagram post, this author can connect you with more info about the scammers and the scam.
Section 2: Scammers at Reddit
In one case, there were three victims. One was swindled out of $45,000 by a person who introduced himself as Anthony Klaren. He promised to “give you back your money” with a “new app.” He claimed that a “significant sum” was involved and requested for a wire transfer. All three victims accepted the request and wired the money to him, unaware of what they were getting into.
How to avoid bitcoin scams
If you’re looking into cryptocurrencies, it pays to learn the trade secrets. Beware of companies that refuse to give you details about their business or send you long strings of crypto jargon when you ask for a demo. If a company is vague about how they plan to use your funds, run.
Be cautious of start-ups or people you’re unfamiliar with that don’t live up to their promises. All it takes is one fraudulent contact for your money to get stolen and the cryptocurrency you were working towards getting quickly forgotten. Look for charities, publications or businesses that are active and transparent about how they work. And, most importantly, never send money to an email with unknown spelling mistakes.
Why are these scams so prevalent?
“These are scams, plain and simple,” says Leo Sun, a tech reporter for CNBC. “They’re all online scams. Most have one product: usually coins, or an app store-based trading platform. Most don’t have a working prototype, so they have to build them up with outrageous claims.”
Is there a legitimate crypto service out there?
That depends on your definition of legitimate. Cryptocurrencies are notoriously tricky to pin down. There’s no mechanism for policing fraudulent activity on the blockchain; rather, everyone who is running a business on the cryptocurrency network is responsible for the payments they make and receive. That makes it hard to determine what’s legitimate and what’s not. But Sun says that the FTC has made it clear that cryptocurrency scams are illegal.