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December 2006

How to Prevent Bitcoin Fraud by Securing Your Identity

bitcoin fraud

bitcoin fraud

Theft has been a problem in all of history, but the digital age brings new challenges. While digital currency has several advantages over cash, it comes with some unique risks, like hacking and online fraud. Cryptocurrencies such as Bitcoin solve some of these issues, but you should still take care.

The fact of the matter is no form of money is ever 100% safe without proper protection. Just because Bitcoin is more secure doesn’t mean you shouldn’t be careful with it. Like with any other kind of currency, you must take steps to keep it safe.

Safety Advantages of Bitcoin

Bitcoin already boasts several security benefits over traditional currency. When you buy something with a credit card, a third party pulls the funds from your account (known as a pull transaction). Bitcoin, on the other hand, uses push transactions, where you hand the payment over yourself.

With pull transactions, hackers can pretend to be you and get your bank or credit card company to move money for them. With a push transaction, though, they need access to the money itself, not just your personal information. That’s not where Bitcoin’s safety features end, either.

Bitcoin leverages the blockchain, so it’s decentralized and immutable. Some scholars suggest using Bitcoin to prevent identity theft because the system is so secure. There are still some precautions you should take, though.

Recent Bitcoin Fraud Cases 

It may be more challenging to commit fraud with Bitcoin, but it’s not impossible. If a criminal steals your identity, they may be able to access your Bitcoin wallet. Since there are 15 million cases of identity theft each year, it’s no small risk. 

In 2018, a fraudster stole $5 million worth of cryptocurrency through a scheme called SIM swapping. This process involves tricking phone companies into transferring numbers to a SIM card that you control. By stealing phone numbers, you can access a wealth of accounts, sometimes including Bitcoin wallets.

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With Bitcoin, your transactions are secure, but your wallet may still be vulnerable. To get the most out of Bitcoin’s security advantages, you need to make sure your wallet’s safe. 

Guarding Private Security Keys

The easiest way into your wallet is with your private security keys. If you want to keep your Bitcoin secure, you’ll have to adopt safe security key management. The first step is to keep offline backups of all your keys.

You should take steps to make sure these offline backups are safe, too. The most straightforward way to do this is to store them off your computer, like on a flash drive or physical document. Be careful to protect these storage solutions, too, not letting them slip into the wrong hands.

You can also turn to security software to keep hackers from accessing your backups. If you choose to go this route, make sure you update your software and operating system frequently.

Crypto Account Management

If you use a service to store or protect your Bitcoin, you’ll have to secure that account. If a fraudster can convince the service that they’re you, they can gain access to your cryptocurrency. Since email compromise is the leading type of online fraud, you can start by securing your email.

Use two-factor authentication for all of your email addresses. You may consider using email security software as a second layer of defense as well. While you’re at it, it’s a good idea to set up two-factor authentication on any service you can.

Make sure you never use the same password for more than one account. If you have trouble creating or remembering strong passwords, you can use a password manager.

Other Standard Security Practices

As with traditional currency, be careful where you send your Bitcoins. While hackers may not be able to access your wallet through a transaction, they can fool you into paying them. Always double-check to make sure a company or product is legitimate before paying them.

Using more than one Bitcoin wallet is always a safe practice. That way, if hackers get into one, they won’t be able to access all your money. You may also want to use a VPN while accessing your wallet and update your operating system regularly.

Plan to Use Bitcoin? If So, Keep Your Data Secure

Bitcoin allows you to secure your finances more than you’d be able to with a credit card. It’s possibly the next step in digital currency, offering more financial freedom and safety. Just be sure that you don’t get too comfortable with its security.

You should be just as careful with Bitcoin as you are with traditional money. If you take the right steps to secure it, though, then you can use cryptocurrency without fear.

This article was curated through CryptoCurrencyNews’ Contributor Program. If you would like to write for us, send us your submission!

Featured image: DepositPhotos © Frank-Peters

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Crypto-Jacking on the Rise According to McAfee Report



Crypto-jacking campaigns increased substantially in the first quarter of 2019 according to a McAfee Labs Threats Report published yesterday.

The prevalence of ransomware attacks climbed a massive 118% during Q1, while malware attacks increased by 29% in the same period. The report also states that the attacks were indiscriminate, meaning that both Windows and Apple users were targeted. The majority of attacks on Windows users were carried out using PowerShell, which is a scripting language that allows system administrators to rapidly automate tasks and manage operating systems.

One of the larger crypto-jacking campaigns reported by McAfee was the malware PsMiner, which is specifically targeted at Monero (XMR). XMR is currently the 12th largest cryptocurrency with a market cap of $1.16 billion USD and is popular among users as it allows for completely anonymous peer-to-peer transactions, without even tracing the user’s address, as well as the potential for high rewards. Recently, French authorities stopped a virus that had infected over 850,000 devices in order to mine Monero.

Apple users were targeted by a malware called CookieMiner, which shared code with a past campaign in order to steal digital wallets and credentials. CookieMiner stole data from many popular exchanges, including Binance, Coinbase, and MyEtherWallet. Despite the huge increase in crypto-jacking campaigns, McAfee’s report stressed that hackers still require the involuntary cooperation of victims. “Even with all the sophisticated attack techniques being developed, attackers are still highly dependent on human interaction and social engineering,” the report concluded.

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McAfee’s report comes just weeks after CipherTrace published its Cryptocurrency Anti-Money Laundering (AML) Report. This report estimated that in Q1 2019, cryptocriminals illicitly obtained 1.2 billion USD in cryptocurrency. Both of these reports reiterate the need for increased monitoring of crypto platforms by authorities. In June, the G20 nations gave their full support to the Financial Action Task Force’s (FATF) new “traffic rule,” which requires transactions between exchanges to include personal information about the sender and receiver of funds.

Featured Image: DepositPhotos © maxkabakov

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Facebook Set to Launch Its Own Cryptocurrency Coin



In 2018, and early this year, Bitcoin experienced a bearish market that riled the interest of several parties and social media companies such as Facebook. As a result, Facebook has since entered the blockchain space with its own cryptocurrency known as FBCoin.

FBCoin and WhatsApp Users

“FBCoin” is an unofficial name for the crypto asset that the social media giant has designed for its users. Facebook intends to unveil the technology to billions of its users, along with the real name.

Besides Facebook, several technology companies have acknowledged the potential and power of crypto technology to revolutionize economic and financial systems. Cryptocurrencies are decentralized in nature, and as a result, Bitcoin has become vital to fintech in recent years. Facebook’s token is looking to compete with the best, including Bitcoin.

According to reports, FBCoin has been slated to appeal first to WhatsApp users in India for purposes of satisfying the domestic need for digital payments that has grown to prominence in places like China. The FBCoin will be developed on the stablecoin-esque model, backed to the cryptocurrency industry through external assets. It is not yet known whether the FBCoin will operate on a blockchain but on a number of occasions Facebook CEO Mark Zuckerberg has alluded to distributed ledger technologies.

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Facebook Could Reach $19 Billion Windfall

Most cryptocurrency analysts believe that the FBCoin could garner massive traction in the coming years. In a note, Barclays’ Ross Sandler indicated that the coin could reach $19 billion in revenue windfall by 2021. The decentralized nature of Facebook and the coin’s status has left many crypto enthusiasts with questions regarding its potential.

Interoperability of FBCoin with other crypto assets is vital for its success, but the coin is seen as an intranet of money while other assets use the internet of money system. FBCoin will soon be launched as the company has been in discussions with other cryptocurrency exchanges.

Featured image: DepositPhotos © BrianAJackson

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Bitcoin Struggles to Hold the Rally



Cryptocurrencies have been struggling over the past few days with increased scrutiny and piling up of bearish signs. Bitcoin, for instance, is nearing a turning point, and according to popular cryptocurrency analyst DonAlt, it is closer to testing support levels of $6,700.

Bitcoin Drops Below the 50-Day Moving Average

The signs are indicating that Bitcoin is headed for more losses after breaking below the 50-day moving average. This is an indication of the end of the recent rally that brought the world’s largest crypto close to $14,000 at the end of last month. The digital coin has fallen below the GTI Vera Band indicator’s lower limit, and as of the last session, BTC was trading at $9,475.

The analyst measured Bitcoin’s current bias on a three-day span on Monday, which provided clarity on the digital coin’s price movement showing that it went past the 3-D pennant structure but on the downside. Bitcoin has failed to enter the range, and this further asserts the possibility of extending its downward trend.

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Price Analysis

As the coin deepens its plunge, DonAlt has provided three major support areas. The first region is between $8,150 and 8,850, which has been a strong resistance level for Bitcoin for multiple occasions this year. Also, he has indicated that the second support area will be in the region of $6,700 because it has an account of experiencing enhanced selling pressure. Judging from how the coin performed last year at the $6,700 support level, prices are likely to be sent higher at more than 79% and 51% respectively for the two occasions.

The cryptocurrency market is reacting to various issues happening, such as greater regulatory scrutiny on digital coins, which will likely become a major talking point as the US approaches its 2020 elections. Other developments that have sent the prices down include the fallout from launching Facebook’s (NASDAQ:FB) stablecoin, as well as the ongoing trade war between the US and China.

Featured image: DepositPhotos © timbrk

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