From late March 2020, when the global pandemic Covid-19 paralysed many economies, the appeal of cryptocurrencies has grown. Several statistics show increased interest from downloaded wallet apps to peer-to-peer traded volumes. In many ways, this interest in bitcoin and altcoins is evidence that the policies of central banks are failing. Many professional investors, as well as ordinary people, are losing confidence in fiat currency systems.
However, many that are exploring the idea of investing in crypto alternatives are falling victim to scams. It seems more scam crypto sites are roaming the space than bonafide cryptocurrency businesses.
It turns out that criminals also appreciate the shifting dynamics and are aware that investing in bitcoin is the new in-thing. In fact, the FBI issued an alert in April warning potential investors to be on the lookout for cryptocurrency-related scams.
The start of the severe lockdown measures meant homebound individuals suddenly had more time to explore and experiment with different investment propositions. The challenge now is how to tell if a crypto-related website is genuine or not?
For the most part, it appears bitcoin-related scams employ similar tactics used by organised criminal syndicates to entice victims. There are some tale-tell signs that expose potentially scammy crypto websites which investors need to look out for.
The Lure of Passive Income
Any scam website would not be interesting if it fails to promise a healthy rate of return to investors for doing almost nothing. A typical scam starts by telling an investor that with just a small deposit, they will be guaranteed returns of 10% and above per month. As an extra inducement, the investor is told the interest earned will be compounded on a monthly basis.
Still, the mere mention of guaranteed passive incomes may not be enough to lure many investors. So in order to get even more people interested, the scam website must also promise investors a quick path to becoming the