Bitcoin Scams That Shocked the World

November 19th, 2018

Bitcoin Scams That Shocked the World

Bitcoin is a popular digital currency which is getting a huge response from every sector of the cryptocurrency world, but as it increases in popularity, the amount of  scams increase as well.. Bitcoin is regarded as a safe and secure digital currency which is very hard to hack, but whenever there is a scam in the news, it can hurt its reputation.  Here is a look at some of the biggest Bitcoin scams in the past:

Silk Road

Silk Road was one of the most famous sites on the Tor Network. Silk Road was once an infamous black marketing site which allowed the trading of various illegal things. Within a few years the Silk Road was taken down by law enforcement agencies which helped cement digital currencies as a legitimate currency.  After that, few things went wrong. The government agreed to auction the digital currencies which were seized from the illegal trading site. This is a a common procedure which happens sometimes when harmless goods that are seized.

Government contacted all potential participants to spread the news of auction and to ask about their interest in signing up. But because of a class email mistake, all potential bidders were able to see everyone to whom the email was sent. This list was then quickly copied, stolen and sold. This resulted in a wave of fake emails sent to all individuals or enthusiast who were interested in buying Bitcoins. Many phishing schemes like this pretended to be from government or other related agencies allowed scammers to steal digital currencies from enthusiasts who participated. This error shook the Bitcoin market.

Since then the use of genuine or authentic Bitcoin Exchanges started growing. Many popular exchanges such as Bitcoin of America made its way in the market, giving digital currency users the opportunity to trade safely and securely.

Canadian Bitcoins

This same thing happened to Canadian Bitcoins, a popular Bitcoin Exchange that was used to manage or trade digital currencies for Canadian investors. It was in the year 2014 that this digital currency exchange was expertly hacked and over $100,000 of Bitcoins were stolen. How did this scam come into place? After careful investigation it was found that the Bitcoin Exchange leased out some space at Data Centre for server hardware, the kind of hardware which could be used to hack into exchanges.

A hacker sent message to the Data Centre claiming he is CEO of Canadian Bitcoins and needed all security codes. The Data Centre verified the CEO name and sent the hacker all security codes as needed. No one from the Date Centre felt the need of verifying if the message was really sent from the CEO or even asked for any confirmation. The Data Centre didn’t even tried to contact the CEO through other channels and this Bitcoin Exchange scam took place. Investors were definitely displeased when they came to know about this carelessness.

Bitcoin Gold and False Promises

The whole idea of Bitcoin Gold was to design a new form of digital currency. The branding trick was bit shady but nothing about it was illegal. Expert scammers designed a website named offering users a once in a lifetime opportunity to get Bitcoin Gold wallets. All you needed was to submit private keys to protect digital currency wallets and this is where the trap occurred.

In the first place, people shouldn’t have fallen for such scams, but in no time the website looked convincing with whole lot of buyers. Scammers stole over $3 million. The creators of Bitcoin gold were dragged into the scam as they endorsed the website on their Twitter account before realizing it’s a big scam.

This disclaimer informs readers that the views, thoughts, and opinions expressed in the text/sponsored content belong solely to the author, and not necessarily to Bitcoin of America, organization, committee or other group or individual. All investments are at your own risk and should be done after careful research.

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