What you need to know about Cryptocurrency.
Many of you will have heard of Cryptocurrency or be familiar with the term Bitcoin. You may have even seen your favourite celebrity endorsing it on social media. But how did Cryptocurrency begin and is it safe to invest in? Let us go right back to the beginning.
During the 1980s there were many attempts at developing a cryptocurrency, such as DigiCash and B-money. However, it was not until 2009 when a paper was published, ‘Bitcoin- A peer to Peer Electronic Cash system’ that bitcoin gained momentum. This paper outlined the first principles of blockchain and bitcoin.
Taking it back to basics; Cryptocurrency is a digital currency that uses encryption algorithms. Bitcoin is one of the most well know cryptocurrencies and was the first to be established. It is a publicly used method of trade that offers decentralised control, user privacy, and record-keeping through blockchains.
Blockchains are best known for their critical role in cryptocurrency systems. Blockchains store information electronically in digital format which allows users to securely move money around. Although Blockchain technology is very secure, scammers have found vulnerabilities outside of the blockchains, allowing them to hack in and steal cryptocurrency.
Today, due to the huge increase in popularity there are many types of Cryptocurrencies. The Cryptocurrency sector is largely unregulated, as it is rapidly adapting, and laws are struggling to keep up. This has allowed scammers to take advantage of people with no recourse. The lack of protection is something to strongly consider before investing.
Cryptocurrencies were the most common payment method used in investment scams and caused the biggest losses, with $113 million reported lost this year
Scammers are very convincing when it comes to getting you to invest in bitcoin or cryptocurrency. They may trick you into buying cryptocurrency through a false exchange or ask you to send money to a company to buy on your behalf. They may even show you a fake platform displaying the profit or loss of your investment in a bid to get you to spend more money. Ultimately, you will not be able to withdraw your money and the scammer disappears, along with your money.
- Always keep your personal or banking information and digital wallet safe, including your wallet keys. Do not share these details with anyone.
- Keep an eye on your wallet app and look out for any suspicious activity.
- Do your research and only invest in cryptocurrency you understand.
- Take your time. Scammers will use high-pressure tactics to get you to invest, with bonus offers if you act now.
- Be wary of social media advertisements promoting cryptocurrency opportunities, scammers use unauthorised celebrity images and giveaways to trick people.
Be wary of guaranteed returns and make money quick offers. If it sounds too good to be true, it generally is
Falling victim to a cryptocurrency scam can be devastating. It is essential to act quickly if you have made a payment or disclosed personal information. The most important thing you can do is contact your bank immediately if you have made a payment using a debit or credit card, via bank transfer or shared personal details about yourself
Make sure you also change your password and login details to any connected accounts.
It looks as though Cryptocurrency is not going anywhere, so do your research and be aware that scammers are taking advantage of this unregulated sector. If you know of any current Cryptocurrency scams, you can report these to the ACCC or Report Cyber.
