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Types of Crypto Scams on Telegram and How to Protect Yourself

There is a CA in our telegram group. He pointed out that CoinCrunch doesn’t publish many educational articles on securing funds, precautionary measures and avoiding scams.

In other news, Bitbns shut down support on their telegram group, now Bitbns users need to open support tickets on the website for any issues they are facing. when asked why did they do it, “Too many users getting scammed”, says Prashant Singh, co-founder of Bitbns exchange. 

It is true. The number of users being tricked into sending cryptocurrency to scammers is too-damn-high. Scammers have been able to make over INR 1 lakh a month by tricking naive and gullible users. So today, let me point out what kind of scams are there on telegram and how to avoid them. 

A scammer pretending to be Nitin Vaid – admin of Bitbns, shared his earnings

Scam 1: Pretending to be from Exchange Support Team

When you are having an issue on an exchange, you try to get answers on their telegram groups or their admins. These scammers prey on users like these. 

How it works

  • User is facing an issue with an exchange such as Binance, Bitbns, Koinex, WazirX, Coindelta, etc
  • The scammers use similar usernames, same image and display name as the admin of the exchange’s telegram group or use the logo of the exchange itself. 
  • Users mistake them for being from the exchange and trust them.
  • Scammers ask users to send BTC or ETH to “fix the issue”.
  • Users send the amount hoping for a resolution.
  • Scammers run away with the amount, never to be seen again.
telegram scammers dupe users in sending cryptocurrency to resolve issues
A Scammer pretending to be WazirX Support asking for 0.01 BTC to rectify account

How to Identify and avoid such Scammers

It is important to know that anyone pretending to be an exchange support executive could be a potential scammer. Almost all exchanges have notified users that their admins will never message you first. So if you get a message from anyone first, do not engage. 

There are few more ways to identify scammers, here’s how

  • If the person is saying they are from exchange support, click on their name on the mobile telegram app chat window. Check the “Groups tab” and see if both of you have the exchange’s telegram group in common. If the exchange’s official group is not in the list, the user maybe a scammer. 
  • Check the userID by clicking on their name, it should start with ‘@’. For instance my userID is @ThatNaimish and CoinCrunch group’s ID is @CoinCrunchin. On the exchange group, check if that userID is an admin or not. If they are not an admin in the group, they are probably scamming you.
  • Never ever send any money or cryptocurrency. Simple. If they ask for money, they are scamming you. 

Scam 2: Fake Mining Scams

Anyone even remotely interested in cryptocurrency would have heard of mining. Chances are that if you’re new to crypto, you aren’t entirely aware of how mining works. So these scammers try to sell you mining plans as lavish earning opportunities.

How it works

  • Scammers ask users if they know about mining. 
  • No matter what users answer, scammers will then say that there is a mining opportunity that allows you to earn a lot of bitcoin.
  • They will gain your confidence by saying you will be registered on a site and you’ll get your own wallet. They say things like its ‘great investment in cloud mining’, ‘staking coins’, etc.
  • However, these wallets are generated by the company, who has access to the private keys, so the moment a user transfers the fund, they move it from there and scammer disappears. 

How to Identify and avoid such Scammers

Let’s start by saying do not entertain unsolicited messages. But even if you do reply to someone who sends such messages, the best is to never ever send cryptocurrency to anyone. Never send it to a wallet that you do not control. 

Scam 3: Fake OTC trades

Over-the-counter trades are common in cryptocurrency. You don’t have a middleman, the trade happens Peer to peer at a fixed price. Scammers can once again trick gullible users by providing unbelievable prices to buy or sell cryptocurrency. 

How it works

  • Scammer approaches users with a Bitcoin trade offer
  • They usually offer 5-10% premium on current prices to attract the users. 
  • There are two ways they go about from here – they ask you to send Crypto first or they send you a fake NEFT receipt to show payment and ask you to send crypto first. 
  • Once user transfers crypto, these users delete account and vanish

There are many more variations to these scams. This one time to test the scammer’s resilience I asked him to send me his ID. He went on to share his passport (read: fake). Later he sent his bank account details and also an NEFT receipt to show he made the payment. As NEFT takes half an hour to transfer, this becomes a common bait into luring people to send cryptos. Needless to say I did not transfer the Bitcoin and finally he realised I haven’t fallen in his trap. 

How to Identify and avoid such Scammers

Don’t trade OTC on telegram or anywhere unless you really know the person. There are many peer to peer exchanges, some without KYC, so trade there. Don’t be greedy and go for OTC trades when someone offers a premium rate.

Scam 4 – Fake ICO investments

Once again, if you’re into cryptocurrency, you’ve heard of ICOs or initial coin offerings. Many blockchain based projects do an ICO to raise money for development, promotion and adoption of their product. There is a process of investing in ICO, some require strict KYC, some require you to transfer ETH to ICO smart contracts.

However, scammers pretend to be part of the ICO team and dupe users into sending crypto to their addresses by offering “better ICO rates”. 

How it works

  • User becomes part of an ICO’s telegram group. 
  • They receive messages from what looks like an admin from the ICO’s team, but they are not. 
  • They offer users a private sale bonus. For example, if ICO rate is 1 ETH = 10000 tokens, they will offer 1 ETH = 30000 tokens.
  • Scammers then ask interested users to transfer ETH to another address, a “special address”.
  • Once user transfers funds, the scammers vanish

How to Identify and avoid such Scammers

The solution to this is the same as Scam #1 where you receive messages from fake Exchange support executives. Do not engage with unsolicited messages. No offers are good, if the offer is too good to be true. 

Scam 5 – Phishing Sites

Now, this is important. The above three scams can be avoided with little vigilance, but phishing attacks are hard to detect. These users share websites that look exactly like the original website or a completely new website that capture your sensitive information and then use it to hack into other accounts.

How it works

  • A scammer sends you link to a website based on the context of conversation. Example: A scammer says if you’re having issues with Binance, login using this link. That website looks exactly like Binance, but would have nothing to do with it. 
  • Or a scammer will ask the user to try out this new exchange. 
  • In both cases, when you enter user registration or login details.
  • These credentials are then used to access user’s other accounts, where security is minimal. 
  • The user account is hacked. 

How to Identify and avoid such Scammers

Everything looks normal on the surface, no one is scamming you into sending cryptocurrency. Someone tells you to try a new exchange or give feedback on a website. You see no harm but end up being scammed. This scam is a bit more sophisticated. Follow these steps to avoid being phished

  • Do not click on unrecognised links.
  • On all visited websites, check the site link on address bar and verify if they are correct. Keep an eye open for Special characters 
A Fake Binance site. Check the ‘n’

So there you are, now you are five scams smarter. Precaution is better than cure, if you get scammed, there may be no cure for recovering your funds, so be careful. As a thumb rule, never ever transfer any money or cryptocurrency to anyone at all. Absolutely no one, and you will never be scammed. 

What do you think about our list of scams? Did we miss something? Let is know in the comments below.

Image Credits: Telegram users from @CoinCrunchIn. Cover Image Source: Pixabay

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