Scams

‘Do you want to earn more than € 200 a day without working your ass off?’

You’ve probably seen offers like this in videos and photos of slick boys and girls with expensive designer clothes, expensive watches and even expensive cars on YouTube, Facebook and other social media. Sometimes you get a fantastic offer in your mail. Sometimes they address you personally in the city center. They promise you mountains of gold and build castles in the air if you use their product or service to make your move in crypto investments.

Investment is quite difficult

In practice, almost all of these providers make money from you while you lose your money! They take advantage of the publicity that cryptos like Bitcoin, Ether, Dogecoin get because of their huge price movements. Everyone talks about making money with cryptocoins, as if it were the most natural thing in the world. In reality it is difficult. You are in competition with thousands of seasoned traders who have been doing this professionally for years and who know the ropes.

Yet they lure with promises like in the headline above and they manage to convince quite a lot of young people. Who doesn’t want to make easy money?! Meanwhile, they have plans to get your money into their own pockets.

Scams

We have listed a number of those plans on the poster at the bottom of this page. The list is much longer than would fit below or on the poster. Therefore a selection.

  • They propose investing (ICO) in blockchain companies that will soon soar in price: ‘To the moon!’ In reality, 99% of the time, the company doesn’t even exist or is just an empty shop window and they’ll run off with your money.
  • They do a pump-and-dump where they first make the price of a small cryptocoin rise sharply – that is possible because there is very little trading – and when everyone enters at that high price, they quickly sell their share at that higher price, causing the price goes to zero and your share is worth nothing.
  • They use their own custom crypto wallet that after you deposit your money in it ensures that you can’t access it anymore and they can! You will then lose your money and they will no longer be available.
  • They give you ‘free money’ to invest with. They make you think that there really is free money. In this way they try to gain your trust, but of course you also have to deposit money from yourself. In the meantime, you are not allowed to change your login and password and they use you as a kind of straw man for shady practices from abroad.
  • They ask you to install apps or software. It will help you earn money, but in the meantime the malware program will search your mobile or computer to see if you have a crypto wallet and if it can find and pass on your passwords for it somewhere. Once they have that information, your money is gone.
  • They often use a method where you get a share of the profits from other people you bring to their service. Just search for the term pyramid scheme and you will see that they do not make money from cryptocoins but from defrauding people. Late entrants to a pyramid scheme rarely get money. Pyramid schemes are prohibited in the Netherlands.

How can you spot these types of scammers?

Unfortunately they don’t have a ‘Crook’ label on their forehead, but the bells and sirens should go off in the following situations:

  • First of all, of course, when they lure you with promises of large sums of money. The amounts are unrealistically high, which makes it so beautiful and irresistible. The investments are relatively low and the chances of success are highly inflated and put down rosy.
  • They often combine their offer with time pressure. You have to decide quickly to participate because otherwise your chance will be gone and the boat will leave without you. People are less able to think under time pressure, which makes it easier to become a victim.
  • They often use complicated language to create a smoke screen: ‘We have a proprietary trading model that can find the most profitable deals for you by means of artificial intelligence’ or ‘We have inside information from various exchanges and parties so that we know which cryptos will go up soon.”
  • They pretend to be big companies with licenses to trade in financial products when in reality they are a representative of a company based in Cyprus where the laws and regulations are much less strict in the back room with a fake website, fake team members and stock photos. protecting consumers like you.

What can you do about it?

Always ask yourself how it really works. Do your digging on the internet and don’t directly believe what others say because they may be working for the scammers. The practice is that almost everyone who is approached and steps in this way loses money!

Remember this saying…

If it sounds too good to be true, it probably is. Then DON’T do it!

Very old advice

Need more information?

Do you have questions about cryptocoins or blockchain? BlockchainLab Drenthe Foundation is a non-profit foundation with the aim of disseminating knowledge and information about this subject. We organize monthly free online meetups, where we explain complicated matters about blockchain.

We are happy to help you and try to answer your questions. So feel free to contact us via info@bcld.nl.