The Reality Of Bitcoin Scam And How To Avoid Them

bitcoin scam reality

Most people need a quick fix as a result of greed. This is why scammers are having a field day and why we are talking about Bitcoin scam reality. How could you believe that anyone would give you free bitcoins? If that’s your mentality about the whole thing you’re going to lose badly on the long run.

Bitcoin is Money, Earn It

Some scammers are even promoting bitcoin doubling, some are telling you can earn $200, $3000, $5000 for doing nothing. To earn bitcoins you should work for it. No one makes money for doing nothing.

Nearly all the Bitcoin investment programs that you come across on the internet are scams and if you keep on patronizing scams you’ll end up the loser since the real winners in all scam investment programs are fraudsters. 

Scams are evolving with the blockchain and there are many new shades that Bitcoin scams take these days.

1. New Wallet Scams – Wallet Isn’t Really Yours

If you are active in some Bitcoin forums, some scammers will tell you to send your email address so that they open a bitcoin wallet that will mine bitcoins for you.

It is asinine to think that a scammer or anyone else for that matter would be so benevolent to the extent that they don’t need the coins  that they will just mine it for you.

Let me say this, anyone who signed up on a wallet owns whatever is in it. If you carelessly put some BTC in that wallet even in ten years, the scammer can conveniently steal all your coins.

This is a common bitcoin scam these days. It is possible for them to scam millions globally because many are not aware of this fact.

Wallet Opened with Your Email Isn’t Necessarily Yours

bitcoin scam realityIn this scam, scammers tell people that want to earn bitcoins that they will mine bitcoins for them. However, this is after opening a bitcoin wallet with the investor’s own email account.

The investor is asked to send their email so that a new mining wallet would be opened for them. The scammer, after setting up the wallet with the person’s email will give them impression that they can change the password hoping that the investor knows nothing about seed words or mnemonic phrase which is a wallet recovery feature of Bitcoin wallets.

Afterwards, the investor is asked to deposit into the wallet after changing the password. The investor’s deposit is meant to be his mining fund.

Clandestine Recovery of Wallet

They may believe that the wallet is secure and actually put funds in it, but the fund will be quickly stolen by the scammer after recovering the wallet they opened for the investor using the wallet’s seed phrase.

Even if the investor did not invest immediately but kept the wallet for future use, they may never realize that it is a compromised wallet. In future, if they use it to keep funds, the scammers will know when the wallet is funded and steal the bitcoin.

This type of bitcoin scammers have been accumulating compromised wallets for this reason hoping that the owners will use them in future effectively handing them the coins.

2. Bitcoin Investment Scam

Bitcoin scam realityThe advent of cryptocurrencies made many people realize its potential as a source of wealth. Some early adopters became wealthy prompting many to view Bitcoin as the next money-maker.

This is why crypto scams became commonplace. Bitcoin investment scams are high yield investment programs (HYIPs) that promise very high returns on investment.

Scammers are building fancy websites promising outrageous profits to lure people to part with their bitcoins in the guise of investment.

When you come across a bitcoin investment with profit ranging from 1 percent daily to higher values, you are sure that you’re dealing with a scam. Some offer up to 20 percent daily while the more daring ones offer 100 percent in just 24 hours.

What these scams may do is pay the early investors out of their pockets promising them more if they promote the scheme. As more investors put in their funds, the older investors are paid with bitcoins contributed by the new ones. This is the reason why all the HYIPs out there have affiliate or referral programs that essentially are designed to bring in people.

The scammers gauge when they have accumulated enough funds and then exit. The idea is just to use early investors to lure many others with the promises of more payments when they enroll new affiliates.

3. Bitcoin Pyramid Schemes

This scam is similar to the investment scam except that those who buy into it are encouraged to sign up others under them, these are also expected to bring in others in a chain-like system.

They are specifically told the number of new sign-ups each person is expected to placed under them. The so-called matrix system is used in bitcoin pyramid schemes.

These are not sustainable and will naturally taper off when the participants can no longer get new entrants. The owners of this type of scam sign up the top spots and have most of the funds coming in flow to them.

Scams like this only enrich the scammers and a few early participants. Late investors will be left with nothing but losses since they could not register new people.

4. Bitcoin Mining Scam

Mining of bitcoin is no mean feat these days because it demands a lot of mining power that can only be provides by specialized miners such as application-specific integrated circuits (ASICs).

This has not stopped scammers from using the concept of mining to scam people. This Bitcoin scam reality does not preclude the fact that most real bitcoin miners do not have the time to bother with retail investors because BTC mining is big business, at least at the commercial level.

Most people are excited about the idea of generating bitcoins. Unfortunately, few investors are actually informed about bitcoin mining. This ignorance is what scammers leverage on to steal bitcoin funds while pretending that they are mining bitcoins.

Bitcoin mining is not what any regular computer can do. An ASIC miner that can actually mine bitcoins costs more $1000. Having a miner or two does not even mean that you will make profit. This is why even big farms that have many miners join mining pools to increase their chances of mining new blocks and sharing in the pool’s profits.

Scammers lure gullible investors into scams by creating the impression that they are making big profits and that the investor can share in these profits by putting in their own money.

Most Online Bitcoin Mining Opportunities are Scams

bitcoin scam realityIn reality, scam bitcoin miners are not involved in any mining activities but are interested in making people send them money under the guise of mining.

Every cryptocurrency enthusiast should know that any money sent to scam miners may be lost. Like other ponzi, scam miners may pay some early participants to help them lure others in through their referral programs.

They become exit scams when they gain enough bitcoin deposits in their wallets leaving many nursing their losses.

It is easy to identify scam bitcoin mining because they usually have a referral program promising big payments. They also offer massive gains for investors such as daily 2 percent, 5 percent or more.

Such mining investments are definite scams that will steal the money of investors after a few weeks or months. Using these services or promoting them is immoral because even if you made an initial profit, you will lose later. So will those that you introduced to the scam.

In fact, joining these scams is a form of encouragement to scammers to continue in their evil deeds. There are better ways of making money on the internet without scamming others. 

Being informed about bitcoin mining and avoiding greed are the ways to avoid mining scams. All investors in these have one tale of woes or another because the only people that benefit from scams are scammers.

 5. Bitcoin Doublers

Most BTC scams have similar mode of operation because most of them  start as ponzi schemes but when the scammers have lured in substantial deposits in their wallets, they simply pull down their websites and move on to new scams.

Low awareness and greed are the reason scams like bitcoin doublers thrive. Bitcoin doubling is simply a scam script on a website that is designed to deceive people into thinking that their bitcoins could be doubled if they send them to the scammer’s wallet.

The scammers  simply use a fake testimonial program to prompt comments that trick people into believing that their coin will be doubled. For instance, you may see a comment like this, “Wow…my bitcoin just got doubled…” and many others like that. Do not be deceived, you’re dealing with a scam.

Sending your BTC to a bitcoin doubling wallet is like donating your fund to a scammer.

6. Bitcoin Generator Scam

This fraud targets people who think that bitcoin could be generated or stolen from the internet.
The so-called bitcoin generator is a scam script that prompts the site visitor to ‘generate some bitcoins’.

The person has the choice of choosing the volume of bitcoins they want the machine to generate. The fake site pretends that some coins were generated, it tells the user to pay transaction fee to get their bitcoins released quickly.

The transaction fee is the scammer’s objective. They steal the coin sent as fee but the user never gets any cryptocurrency.

7. Buy/Sell Bitcoin Scam

bitcoin scam realityAs a rule, you should never buy or sell bitcoin directly from a person unless in a reputable exchange. There are many good sites where you can buy bitcoins. These are sites where buyers and sellers meet.

Buy/sell bitcoin scam is a type of scam in which a bitcoin thief pretends that they have bitcoin to sell or that they want to buy from you if you have some to sell. They hope that you’ll be naive enough to send them the money for the bitcoin first if you’re the buyer. As a seller, they hope that you send your coins first.

If you send the money as a buyer you’ll not get any coins. Send your bitcoin first as a seller and you won’t get paid so in both instances you are scammed.

You have to bear in mind that scammers do not have a living conscience when they’re trying to steal from people, so never sell or buy bitcoin from a random individual when you could conveniently do so in an exchange.

Exchanges use escrow services. No one is scammed since the exchange holds the BTC until both parties are satisfied.

8. Bitcoin Gambling Scam

Bitcoin scam realityThis is a scam in which fake casinos are used to lure gamblers into playing. In this fake casinos, they always give free play and trials and make sure that the user wins.

What these scammers do is that they set up fake casino and give out free stakes. Players naturally take advantage of the free point to play the game which has been programmed to make them win.

When the winner tries to withdraw the winning they are asked to pay a withdrawal fee which they may pay hoping that they have won big but that would be the last communication they receive from the scam casino.

9. Bitcoin Blackmail Scam

As the name implies, the scammers randomly send out emails to people and businesses threatening to reveal some secrets that the receiver has. For instance, a man in California received an email threatening to tell his wife about his infidelity. He was forced to send payments in bitcoin to the scammers but kept asking for more and he felt his best bet was to report to the police.

The scammers most times do not know if the person actually did what they wrote on the email. They just operate based on the belief that everyone has a secret.

In Netherlands, businesses have been threatened with bombing if they didn’t send bitcoins to a wallet. The report says that even though none of those businesses reported to the police as a result of the blackmail some actually sent the scammers some bitcoin.

To beat bitcoin blackmailers, bear in mind that they sometimes know nothing about what they are claiming to know. Bowing to the threat will have them coming back to demand for more coins. 


Hackers are known to hack into servers stealing important data. They lock up the data and demand payments in bitcoin or other cryptocurrencies to unlock the data. Businesses are usually the targets of such attacks. Your best bet is enhanced security of your system administration.

10. Binary Option or Trading Scam

Have you come across a post on social media claiming that someone made $3000 in a few days after sending BTC to an expert trader to trade for them? If you have, that was a binary option or BTC trading scam

The promoter claiming that an expert trader helps people earn bitcoins is actually the ‘expert’ and wants you to send some BTC to benefit from the so-called trade but in reality their interest is your capital. If you send the coins you’ll lose them since they are into any form of trading but are just scammers seeking ways to steal your coins.

In any case, it doesn’t make sense to send your cryptocurrency to a random person on the internet just because they claimed you’ll make profit if they trade for you. No one makes money by being careless with the fund they already have in their wallets.

All claims of instant profit, large gains and such has the objective of luring you in and stealing your bitcoins. Binary option and Forex traders that claim overnight riches are no exceptions.

11. Private Key Phishing Scam

You must have known by now that whosoever holds the private keys of your wallet is in possession of your bitcoins. The more sophisticated scammers build sites that are meant to phish for the private keys of Bitcoin wallets.

These sites will prompt the user to take some actions such as exporting their private keys into an app or similar programs. If such keys are exported, they are sent to remote servers where the scammers access them and gain access to the wallets of the owners.

Do not be surprised to see an empty wallet if you were deceived into exporting your wallets private keys. Private keys are meant to be kept safe. Never share or even store them on your computer.  

12. Paid-To-Do Scam

bitcoin scam realityThis is one of the scams that is not very obvious yet it is considered scam because it wastes people’s time and reward them with bitcoin dust. I’m sure you have come across websites that pay very small amount of bitcoins for performing irrelevant actions such as spinning wheels, watching videos and reading ads.

In reality these sites are selling traffic to the advertisers and sometimes getting paid hundreds of dollars. They encourage users to recruit their friends and sit around taking irrelevant actions for some satoshis.

Faucet, paid to click sites, paid to view sites and others like them claim they generate traffic for websites but they only use people they’re wasting their time to generate worthless traffic to those sites. The users of these sites do not even know they are being scammed as they waste their time for bitcoin pennies.


There are many ways to genuinely earn bitcoins. The problem with most people is that they are more interested in quick fixes and are too lazy or unwilling to work. This is why they fall prey to scams.

Also, criminals will always follow the money so learn about how bitcoin works so that you do not get scammed.

To make money, work. When you work honestly you can make money. What other bitcoin scams do you know? Tell us in the comment box below.

Author: Jofor Humani

Jofor is a crypto journalist with passion for investigative reviews.

13 thoughts on “The Reality Of Bitcoin Scam And How To Avoid Them

  1. Hi Jofor,

    Thanks for the great information. I know that bitcoin can be a legitimate form of currency but it seems like there is just so many scammers involved with it now, which you have confirmed. I am constantly getting scam e-mails demanding bitcoin and I know that many people have been blackmailed over bitcoin. Sad really. It seemed that bitcoin had so much promise in the beginning. Hopefully it gets cleaned up before its too late.

    1. Dan, scammers will always follow the money and bitcoin is money. That’s why we are educating people on how to avoid the scams. It is really possible to keep scams to minimal levels if people educate themselves about bitcoin. Thanks for stopping by.

  2. I think your site is amazing. Very informative and educational. I really learned a lot about what bitcoin is. I had no idea previously of what it was or even what it was used for. I appreciate the information. Now I know what to look for and what to avoid all thanks to your wonderful site. Great job and Thank You

  3. Good evening Jofor,

    I really enjoyed reading your post. I was thinking of checking out bitcoin while I was in Thailand last year but everything I came across was the quick fix get rich scheme. I haven’t found good information until 6 months ago on crypto and on top of good advice like yours. It’s unfortunate that so many people fall for these scams and makes cyrptocurrency seem corrupt.

    1. You’re right Rowan. The reason the industry is seeing a lot of rejections is that scammers as usual have followed the money and have become a nuisance to everyone. The reason is that many are not informed about Bitcoin and the hazards that may be associated with it.

  4. And this, is one of the many reasons why I stay away from cryptocurrency unless it’s forex trading. There’s just too much risk. Sure, the bitcoin boom might have benefited a few people who invested early in the past years but the situation isn’t the same. I don’t have the time or patience to be walking on eggshells in fear of scams around every corner.

  5. Wow, It’s crazy how much time these scammers but in to there “business” I have seen so many adds recently about crypo currency and they do look so tempting but I’m always sceptical and it looks like I was right to be.

    Thanks for the post at least I know what to look out for now.

    1. Absolutely right Jason. Scammers go to any lengths these days because they are aware that there are many people interested in earning bitcoin without learning about it.

  6. Boy am I glad that I found your site! I have definitely considered some of the above bitcoin programs, but never bit because it just didn’t feel right in my gut.

    A lot of these schemes are just new iterations of old tricks, and you do a great job of pointing them out here.

    I appreciate the post.


    1. Thanks Jerimy…as you said, these sacams are new versions of old tricks fuelled by greed. Glad you learnt something here.

  7. Thank you for this valuable information. When cryptocurrencies first came out I remember how everyone was shouting from the rooftops that it was the greatest money maker and that blockchain was scam free. I personally did not buy into all of the hype.

    First off anything new when it comes to making good money is going to attract scammers and blockchain technology would eventually be hacked. If people want to make good money they better start working hard for it, even if it is online.

    I could clearly see that those who got in during the beginning hype would do well but those that came after would subjected to a multitude of scams. And I was right. Scammers started popping up everywhere and it became so bad that both Facebook and Google banned any kind of cryptocurrency ads from their websites.

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