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Top 5 Bitcoin Scams – And How To Avoid Their Trap

Tips to avoid wasting your bitcoin with bitcoin giveaway scams, bitcoin doubler scams, cloud mining scams, HYIP scams, and ICO scams.



The world of digital currencies is expanding every day and many sites and companies are entering this modern world. However, considering that public awareness about Bitcoin has not been done yet and some people still do not know Bitcoin completely; a bitcoin giveaway scam has been formed. These sites and companies commit many scams by deceiving people and exploiting their little knowledge. In this article, I want to share with you tips for avoiding cryptocurrency scams like bitcoin giveaway scams, bitcoin doubler, cloud mining scams, ICO scams, and HYIP scams to increase your awareness and knowledge about these types of scam sites and invest in the world of digital currencies and bitcoin with enough information.

These sites come in a variety of forms that deceive people and take their bitcoins to make a lot of money. In most cases, these sites do not exist externally at all. Also, the information posted on the site is completely fake. as a result, using payment systems such as Bitcoin and other digital currencies and registering fake site information, tracking these people is almost impossible. Usually, these people use Bitcoin mixers (especially in HYIP and ponzi scams) to make most of their transactions untraceable. Even if they do not, it will be difficult to identify them due to the use of digital currencies. If such a company catches your bitcoin and cheats you, your chances of using these companies and receiving your own money will be very low.

1. Bitcoin giveaway scams

Giveaway scams are one of the special methods of fraud. In this method, which was formed in 2017, fraud is done in the form of social engineering. They claim that a large digital currency site or a famous person is hosting a giveaway. You will then be required to pay some of your digital currency to participate in the giveaway to become a member and receive a giveaway. Since these transactions are not traceable and the giveaway has no real identity, you will lose your bitcoin forever by a bitcoin giveaway scam.

An example of a bitcoin giveaway scam:

Don’t click on this! This is a bitcoin giveaway scam example.

The most recent giveaway scam is the fake Elon Musk giveaway. Elon Musk is famous in the world of digital currencies and has supported dogecoin. Scammers in this way make people think that if they give some digital currency to this celebrity, they will get more repayments. This scam, which involved many young people, has taken $2 million from people in the last 6 months.

Other examples of bitcoin giveaway scams

  • Coinbase Twitter Impersonations
  • YouTube Live Streams
  • Giveaway Scam Email
  • Celebrity Twitter Impersonations
  • “Hack the blockchain” scams
  • HYIP program, or Ponzi schemes
  • John Mcafee or Binance fake giveaway

2. Bitcoin Doubler Scams

One of the most popular scams is bitcoin doubler. These sites are increasing every day and the way they work is very interesting. These sites are not just for bitcoin and there are many sites that dogecoin, LTC, and Other digital currencies are also accepted. In fact, for these sites, it does not matter what digital currency you have. They want to take it from you, with a tempting offer. The peak of this scam was in 2018, but it continues to this day. These sites claim to double your bitcoins! That too for an irrational reason. Another type of scam is similar and it pays investors with other people’s money. We will see it in more detail below.

3. HYIP scams and Ponzi schemes

Never trust bitcoin doublers or giveaways which promise to multiply your money, they are all scams!

The HYIP or Ponzi scheme scam is a variation of the bitcoin doubler scam, where they claim to give you a percentage of profit when you invest your bitcoins with them. Then after a few days it stops paying investors and disappears. The truth is they were paying users with other investors’ money.

Any website, HYIP, Ponzi, or otherwise, that claims to multiply your bitcoins is definitely a scammer. It may double your digital currency in the first few days and times. After doing this, there will be no more news about them. Then to avoid the police they will close their website and domain name.

How does a bitcoin doubler work?

There are different methods that these scam sites use, but the main purpose of all of them is to deceive people by promising to double their bitcoins. Some of them claim that after depositing after 2.3 hours, your bitcoins will double. Some of them also ask you for 24 hours to do this. There is another type that allows you to bet your bitcoins and they will double it for you. In fact, the methods and claims of these strange sites are different, but they all have one thing in common: scams!

The bitcoin doubler sites have really weird and false claims, from hacking a bitcoin network to doubling your bitcoin to having a script to doubling it. but one of the most common claims among these sites is that they are large investment companies. by claiming that their large company is bringing your capital into the market and multiplying it, they are trying to defraud themselves in the form of a large company.

An extreme example of the bitcoin doubler scam

In 2020, three people hacked the internal systems of Twitter to send fake bitcoin doubler messages from several verified accounts. It was very successful with dozens of people reporting that they lost their money. Some exchanges such as Coinbase blocked the bitcoin address, saving people from getting scammed. But you cannot rely on exchanges to protect you from all scams. Later, the FBI and UK law enforcement agencies identified and arrested the hackers.

One of the most infamous HYIP and Ponzi scheme scams was the Bitconnect project. It invested users’ Bitcoin for the Bitconnect Coin, with an interest rate. When the Bitconnect website shut down and refunded everyone their tokens, the Bitconnect token price went down by 99%. Many people lost their life savings. This is also an example of an ICO scam, which we will talk about later.

4. Cloud mining scams

Many cloud mining scam sites simply take away your balance when you withdraw.

This is a way for companies to charge you to extract bitcoins and do the extraction for you. It is another way to defraud users. In the cloud mining scam method, you rent mining devices and receive your profit every month after paying the subscription fee. Not all of these sites are scammers and there are good companies in this area. But you should be aware that hundreds of scam sites scam people this way every month.

Scam method in bitcoin cloud mining

At first, fraudulent companies seem perfectly legal. They introduce you to monthly plans that have good profits (these companies usually offer huge profits per month because they want to deceive people). After depositing money and purchasing your monthly plan, you can see in the dashboard that bitcoin is being mined. But after about 1 month of requesting a withdrawal, you will receive different errors.

These errors are various, from sending identity information and confirmation by the site administrator to blanking the page and blocking the account. In fact, you were only looking at imaginary numbers in this 1 month and no bitcoins were being mined. There is nothing you can do to understand this after 1 month. So first look for the WHOIS and domain information of this company and see if it is real or not. Also, before investing in these sites, research them. You can use to check the identity of any website.

It is also helpful to understand that it is no longer possible to mine bitcoin on computers. It used to be possible to mine bitcoins on PCs and laptops but the mining difficulty became high quickly. So now, only people with a large number of ASICs (hardware miners) can mine bitcoin with a profit. You should understand that mining bitcoin, litecoin, ethereum, etc. on PC is a waste of time and a common trap that scammers make.

5. ICO scams

ICO scams happen when token organizations try to make a quick buck.

You must first become familiar with the concept of ICO. ICO stands for Initial Coin Offerings. These services are used for new companies and to raise start-up capital. New companies use the introduction of ICOs, raising money or launching tokens, or creating their own services. ICO is like IPO, but with the difference that it is used for companies and young organizations.

But what is the method of ICO scams?

Many companies are established only to defraud and create ICOs for their own benefit. By giving empty hope to investors, they ask them to invest and after collecting the initial capital, these companies disappear. these companies are pre-selling their coins to you, and with the expansion of blockchain and ERC-20, these tokens are increasing. When you pre-sell, they are actually asking you for bitcoins for the initial cost of the company. After payment, you will be told that the company will start operating on x date and these coins will multiply. But after that date, either that site will be destroyed or you can sell them only at a very low price. In fact, they will take your bitcoins from you and return a very small amount of money to you. This is where the ICO scam project fails.

Ways to detect ICO scams

Look at the support team and see if they care about their goals. Then look at the future of the company and the whitepaper and token sale. Always be careful when investing in these companies so that you do not lose your time and money.

Tips for reporting scam websites

  • Report the scam by filling out the form on ScamAlert.
  • Report the website domain name on Google Safe Browsing so they can block it from Google Search.
  • Notify law enforcement about the scam so they can arrest the scammers. Here are the links to the FTC (USA), Action Fraud (UK) and Cyber Crime Cell (India).

Now we have explained the bitcoin doubler, giveaway, HYIP, cloud mining, and ICO scams. We recommend not investing your money into any of them. Instead, you should use faucets if you want small, free money. But be careful of which faucet you use because some of them are also scams, with a high-profit promise but want to steal your bitcoins and other cryptos. You should always do some research before using any bitcoin-related service.

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Korbit charged for excessive customer data collection

Korbit, a well-known cryptocurrency exchange, has been charged and fined over “collecting excessive personal data” from at least one of its customers.



Korbit, a well-known South Korean Cryptocurrency exchange, has been charged and fined over “collecting excessive personal data” from at least one of its customers. 

Korbit is a South Korean company that is heavily vested in the cryptocurrency market. The brand is owned and operated by Korbit Inc, a company located in Gangnam-gu, Seoul, South Korea. The brand commenced operations in 2014 after securing huge financing from several venture capitalists.

Korbit performs the following cryptocurrency-related services:

  • Cryptocurrency trading for the local South Korean market.
  • Fiat to cryptocurrency exchange services using the South Korean Won (KRW) as the fiat currency of choice.

South Korea has a large cryptocurrency trading market, largely populated by local players and companies who moved there when the Chinese ban on cryptocurrency trading came into effect. By providing the local and regional market the opportunity to use the local currency to purchase cryptocurrency tokens or secure cryptocurrencies for trading purposes, Korbit fulfills a large need.

So Korbit is a very well-known exchange, and they get fined for a matter like that has been a matter of talk between crypto experts.

A Small But Significant Fine

According to Yonhap, a news agency, “ They have been charged USD 4000 for this by a government watchdog for ordering a customer who had attempted to activate a dormant account on its platform to upload a photograph of their national ID card.”

The court took the case before the Personal Information Protection Committee. Then they met in a plenary session to rule on the case. The crypto exchange Korbit argued that it needed proof of a photo ID to prevent financial crimes such as voice phishing scams, adding that account users could begin trading immediately after activating dormant accounts.

But the committee overruled their argument and decided in favor of the user in question, claiming that none of Korbit’s other “big four” crypto exchange rivals (Upbit, Bithumb, and Coinone) required photo ID submission activate such accounts.

The committee ruled that mobile phone verification would have been sufficient in this instance. The exchange was guilty of violating the “principles of minimum personal information collection” specified in the Personal Information Protection Act, which was passed last year.

The decision made was absolutely correct because there was no point for them to ask for full ID verification. Mobile verification was acceptable, and the demand for photo ID verification was completely useless.

Korbit Jumps Into NFT Craze

In the meantime, Korbit has also started selling these days popular non-fungible tokens (NFTs) for a hit South Korea drama series. Per EDaily, Korbit struck a partnership deal with the production company Studio Dragon, the creator of the drama Vincenzo, a mafia-themed series starring Song Joong-ki that aired on the cable network tvN earlier this year.

The deal will see the company sell 100 limited edition official pieces of art based on the show on a first-come-first-served basis on July 21.

Korbit stated that it plans to create more NFT items for “other popular dramas” produced by Studio Dragon.

The company also said and showcased one of the items it plans to sell – an NFT featuring an iconic lighter used by the main and titular character in the drama, also distributed by the streaming giant Netflix.

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Bitcoin Core 22.0 To Add Hardware Wallet Support

Bitcoin Core will start to support connection with Hardware Wallets with HWI library. New options for hardware wallets will be added to the settings.



The latest version of Bitcoin Core v22.0 will add support for hardware wallets. It will start to support connection with Hardware Wallets with HWI Python library. The overall interface of the wallet will change in the latest version and new options for hardware wallets will be added to the settings and then we will be able to create a new wallet with our connected devices.

It is pretty good news and bitcoin users are looking forward to giving this wallet a go as soon as it releases.

Bitcoin Core can be launched with -signer=<cmd> where <cmd> is an external tool that can sign transactions and perform other functions. For example, it can be used to communicate with a hardware wallet.

Among other changes, Bech32m (witness v1) addresses are now supported for most RPC calls. Adjustments were made to the RPC calls for banning, network, and peer information. It no longer supports MacOS versions older than 10.14 “Mojave”.

22.0 Release Notes Draft

Below is a copy of the relevant section of the release notes that mentions the signing feature.

GUI Changes

External signers such as hardware wallets can now be used. These require an external tool such as HWI to be installed and configured under Options -> Wallet. When creating a new wallet a new option “External signer” will appear in the dialog. If the device is detected, its name is suggested as the wallet name. The watch-only keys are then automatically imported. Receive addresses can be verified on the device. The send dialog will automatically use the connected device. This feature is experimental and the UI may freeze for a few seconds when performing these actions.

Example of Usage

Although this tool is hosted under the Bitcoin Core GitHub organization and maintained by Bitcoin Core developers, it should be used with caution. It is considered experimental and has far less review than Bitcoin Core itself. Be particularly careful when running tools such as these on a computer with private keys on it.

When using a hardware wallet, consult the manufacturer’s website for (alternative) software they recommend. As long as their software conforms to the standard below, it should be able to work with Bitcoin Core.

What does the HWI library do?

The primary use of HWI is to discover hardware wallets that are connected via USB ports. It uses the udev project, which means that Windows is not supported. It only works for macOS and Linux. Fortunately, HWI and hardware wallet support are optional in Bitcoin Core. It will continue to function normally if HWI is not installed.

HWI is a command-line program that reads commands from the terminal and sends them to the device. The device behaves as if a human is entering physical input to it and executes the commands the same way it would be done manually. It also has a Python API, which makes it easier to add an HTTP API in the future if desired by the project maintainers.

Supported Devices

The following hardware wallets are compatible with most commands of HWI:

  • Ledger Nano X
  • Ledger Nano S
  • Trezor Model T
  • Trezor One
  • BitBox01
  • BitBox02
  • KeepKey
  • Coldcard

HWI has a support policy that states that hardware wallets must use as much open-source firmware as possible. Closed-source parts are acceptable if they are required by a non-disclosure agreement (NDA). Closed-source firmware is tolerated if the vendor provides active support for it, but the hardware wallet support will be dropped if the vendor stops maintaining HWI support for their hardware wallet. Also, if the hardware wallet stops receiving security updates, HWI support for it will be dropped if security vulnerabilities are found.

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Meet The Large Companies Investing In Antminers

Why are these companies only buying large quantities of Bitmain Antminer hardware, and how do they receive them?



Along with Gryphon and Hut 8 Mining Corp, many other companies invest in bitcoin miners. There’s a reason why Bitmain Antminers are some of the most popular in the world. All of these invest in Bitmain mining hardware only. Gryphon is a minor mining operation compared to some of the more prominent players, but they all have a role to play. We will discuss TeraWulf first.


TeraWulf is a new mining company based in the United States purchasing 30,000 miners from Bitmain with plans to have greater than 3 Exahashes (EH/s) of Bitcoin Mining power, which is some serious power that would put it in the top 10 mining pools in terms of hash rate. 

TeraWulf is soon to have a Nasdaq Listing; it agreed to merge with Ikonics, an imaging tech company whose stock is traded on Nasdaq. The newly merged company will trade under “WULF”.

TeraWulf is an example of a medium-sized operation, who has also placed its trust in Bitmain to provide mining hardware.

TeraWulf has a long-term goal to mine Bitcoin with more than 90% Zero-Carbon energy. It has around 50 megawatts of electricity capacity, with long-term plans to increase this to 800 Megawatts by 2025. This would enable a hashrate of more than 23 EH/s. It is ambitious, as it would be in the top 5 of hashrate.

TeraWulf’s low-carbon commitment is a sign of the times with concerns about the carbon footprint of the Bitcoin blockchain. Players the size of TeraWulf can make a difference in the carbon footprint of Bitcoin and help set trends.

Core Scientific

Core Scientific is a mining company in North America. It has recently completed a buy of 112,800 ASIC mining rigs from Bitmain. Core Scientific provides hosting services for miners alongside its operations bought S19 Pro, S19j, and S19j Pro miners intending to double its fleet of miners. Core Scientific can also repair Bitmain mining machines that are under warranty, thus offering Bitmain Warranty services in North America.

Core Scientific intends to use half of the machines it has ordered for its mining operations. They will use the other half to fulfill contracts with existing mining clients.

The large 112,800 shipment and future ones of similar magnitude will help Core Scientific more than double its share of Bitcoin’s hashrate. Core scientific currently has approximately 5% of the current Bitcoin Hashrate. They intend to increase this to 12$, according to their CEO Kevin Turner.

Turner’s forecast aligns with the growing presence of North America in the Bitcoin mining sphere. 

Along with Core scientific, Gryphon, and TeraWulf, other mining companies are looking to expand their operations, such as Marathon, Riot, and Blockcap.

Kevin does not expect the trend of big players investing in the mining space to stop soon, and new prominent players are continuing to enter the game. 

Kevin stated that larger numbers of publicly traded companies, large family companies, and hedge funds are looking for trustworthy mining operations in North America. Kevin believes that the United States is interested in being a leader in digital assets, despite other countries being early adopters before the United States was.

Marathon Patient Group

Marathon is another significant player in the Bitcoin mining industry, based in Las Vegas. They mined no fewer than 196 Bitcoins in 2021, worth over $11 million at current prices. Marathon has planned to expand its mining operation to have no fewer than 100,000 miners online by 2022. Marathon’s hold more than 5,000 Bitcoin. Marathon received an order in Q1 of 2021 for 1,300 Bitmain S19 Pro mining rigs.

Marathon will have ongoing shipments from Bitmain throughout 2021, with a plan to have over 100,000 online by January 2022. Marathon’s total network hashrate is estimated at 10.3 Exahashes per second by then, putting them in the top 10. The company used stock offerings and other financings to invest in the latest Bitmain hardware.

Marathon has planned its high-speed expansion to keep up with other big names in the mining industry. The new machines coming online in 2021 after heavy demand has caused the Bitcoin difficulty to skyrocket due to the flood of hashrate. Bitcoin difficulty is the algorithm that keeps the supply of bitcoins and the Blockchain’s growth constant despite the varying market conditions.

The CEO of Compass Mining, Whit Gibbs, commented on Marathon’s “mammoth” ASIC order. He mentioned he feels that this trend of increasing hashrate and difficulty shows no signs of slowing in 2021 and that it should track with Bitcoin’s price.

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