What to know about cryptocurrency and scams

Confused about cryptocurrencies, lượt thích bitcoin và Ethereum? You’re not alone. Before you use or invest in cryptocurrency, know what makes it different from cash & other payment methods, và how lớn spot cryptocurrency scams or detect cryptocurrency accounts that may be compromised.

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What To Know About Cryptocurrency

What is cryptocurrency?

Cryptocurrency is a type of digital currency that generally only exists electronically. There is no physical coin or bill unless you use a service that allows you to cash in cryptocurrency for a physical token. You usually exchange cryptocurrency with someone online, with your phone or computer, without using an intermediary like a ngân hàng. Bitcoin và Ether are well-known cryptocurrencies, but there are many different cryptocurrency brands, và new ones are continuously being created.

How vày people use cryptocurrency?

People use cryptocurrency for quichồng payments, lớn avoid transaction fees that regular banks charge, or because it offers some anonymity. Others hold cryptocurrency as an investment, hoping the value goes up.

How bởi you get cryptocurrency?

You can buy cryptocurrency through an online exchange platsize. Some people earn cryptocurrency through a complex process called “mining,” which requires advanced computer equipment khổng lồ solve sầu highly complicated math puzzles.

Where and how vì chưng you store cryptocurrency?

Cryptocurrency is stored in a digital wallet, which can be online, on your computer, or on an external hard drive sầu. But if something unexpected happens — your online exchange platkhung goes out of business, you skết thúc cryptocurrency lớn the wrong person, you thua thảm the password khổng lồ your digital wallet, or your digital wallet is stolen or compromised — you’re likely to lớn find that no one can step in to help you recover your funds. And, because you typically transfer cryptocurrency directly without an intermediary lượt thích a bank, there is often no one khổng lồ turn lớn if you encounter a problem.

How is cryptocurrency different from U.S. Dollars?

There are important differences between cryptocurrency & traditional currency.

Cryptocurrency accounts are not backed by a government. Cryptocurrency accounts are not insured by a government lượt thích U.S. dollars deposited into a ngân hàng tài khoản. If you store cryptocurrency with a third-các buổi party company, & the company goes out of business or is hacked, the government has no obligation to step in và help get your money back.Cryptocurrency values change constantly. The value of a cryptocurrency can vary rapidly, even changing by the hour. It depends on many factors, including supply và demvà. An investment that’s worth thousands of dollars today might be worth only hundreds tomorrow. And, if the value goes down, there’s no guarantee it will go up again.

Paying With Cryptocurrency

If you’re thinking about paying with cryptocurrency, know that it’s different from paying with a credit thẻ or other traditional payment methods.

Cryptocurrency payments typically are not reversible. Once you pay with cryptocurrency, you can usually only get your money baông chồng if the person you paid sends it back. Before you buy something with cryptocurrency, know the seller’s reputation, where the seller is located, & how lớn contact someone if there is a problem. Confirm these details by doing some research before you pay.

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Some information about your transactions will likely be public. People talk about cryptocurrency transactions as anonymous. But the truth is not that simple. Some cryptocurrencies record some transaction details on a public ledger, called a “blockchain.” That’s a public các mục of every cryptocurrency transaction — both the payment and receipt sides. Depending on the cryptocurrency, the information added lớn the blockchain can include details lượt thích the transaction amount và the sender’s and recipient’s wallet addresses. A wallet address is a long string of numbers và letters linked lớn your digital wallet. Even though you can use a nhái name lớn register your digital wallet, it’s possible lớn use transaction and wallet information lớn identify the people involved in a specific transaction. And when you buy something from a seller who collects other information about you, lượt thích a shipping address, that information can be used lớn identify you later on.

How To Avoid Cryptocurrency Scams

Scammers are always finding new ways khổng lồ steal your money using cryptocurrency. One sure sign of a scam is anyone who says you have lớn pay by cryptocurrency. In fact, anyone who tells you khổng lồ pay by wire transfer, gift thẻ, or cryptocurrency is a scammer. Of course, if you pay, there’s almost no way to get that money baông chồng. Which is what the scammers are counting on. Here are some cryptocurrency scams to watch out for.

Investment & business opportunity scams

Some scammers tell you lớn pay in cryptocurrency for the right to lớn recruit others into lớn a program. If you do, they say, you’ll get recruitment rewards paid in cryptocurrency. The more cryptocurrency you pay, the more money they promise you’ll make. But these are all nhái promises, & false guarantees.Some scammers start with unsolicited offers from supposed “investment managers.” These scammers say they can help you grow your money if you give them the cryptocurrency you’ve bought. But once you log in lớn the “investment account” they opened, you’ll find that you can’t withdraw your money unless you pay fees.Some scammers send unsolicited job offers lớn help recruit cryptocurrency investors, sell cryptocurrency, mine cryptocurrency, or help with converting cash to lớn bitcoin.

Look for claims lượt thích these to help you spot the companies & people to avoid:

Scammers guarantee that you’ll make money. If they promise you’ll make a profit, that’s a scam. Even if there’s a celebrity endorsement or testimonials. (Those are easily faked.)Scammers promise big payouts with guaranteed returns. Notoàn thân can guarantee a phối return, say, double your money. Much less in a short time.Scammers promise không tính phí money. They’ll promise it in cash or cryptocurrency, but free money promises are always fake.Scammers make big claims without details or explanations. Smart business people want khổng lồ understand how their investment works, và where their money is going. And good investment advisors want to giới thiệu that information.

Before you invest, kiểm tra it out. Retìm kiếm online for the name of the company and the cryptocurrency name, plus words like “đánh giá,” “scam,” or “complaint.” See what others are saying. And read more about other common investment scams.

Blackmail emails

Scammers will often sover emails that say they have sầu embarrassing or compromising photos, videos, or personal information about you. Then, they threaten lớn make it public unless you pay them in cryptocurrency. Don’t vày it. This is blackmail & a criminal extortion attempt. Report it lớn the FBI immediately.

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Social truyền thông media scams

If you read a tweet, text, tin nhắn, or get a message on social media that tells you to lớn sover cryptocurrency, it’s a scam. That’s true even if the message came from someone you know, or was posted by a celebrity you follow. Their social media accounts might have been hacked. Report the scam immediately khổng lồ the social truyền thông platsize, và then tell the vnggroup.com.vn at ReportFraud.vnggroup.com.vn.gov.

How To Report Cryptocurrency Scams

Report fraud & other suspicious activity involving cryptocurrency to