Belgian Government Offers Tips for Avoiding Cryptocurrency Scams

Siamak Masnavi

The Belgian government has launched a new website called "Too Good to Be True" to help investors understand what are some common types of crypto scams and to explain what precautions they should take to avoid being scammed.

Common Types of Scams

  • Crypto investment platforms. Here, you are encouraged to invest by being promised incredible returns; they say no experience is required; you can trade quickly; and everything is fine until you to try to "cash out."
  • Online payments using cryptocurrencies. You want to buy something via an online shop, but the only form of payment the merchant accepts is crypto. Once you have paid, the item is never delivered to you and you are unable to contact the business. However, if you had paid with a bank card or via PayPal, you would have been protected against this type of fraud. 
  • Sport bets made with cryptocurrencies. You are invited to place a bet on some kind of sport event, e.g. a football game. You place a bet and if you win, your "winnings" appear on your account with the firm, but you discover that you are unable to withdraw your winnings.
  • Wallet fraud. This is basically referring to phishing scams where a fraudulent website is pretending to be a trustworthy entity, and your money that you thought you were depositing into your wallet simply disappears.

How to Protect Yourself

  • Find out who you are dealing with. Who is the point of contact? If it is a website, when was it created? Who are the people behind it? If you can't find reliable information, do not invest. 
  • Be careful with sharing your personal data. Be very suspicious if a site or person you don't know asks for your photo ID, proof of address, can account number, or debit/credit card details.
  • Demand clear information. Ask many tough questions. Take your time before deciding to accept any investment offers. Don't allow yourself to get pressured into making a quick decision.
  • Be wary of wild claims about potential profits. When a return sounds too good to be true, that's because it usually isn't. A profit is never guaranteed.

Finally, the home page offers a website reliability checker feature where you type in the address of a suspicious-looking website, and if that site has been reported as fraudulent, you will be notified of this fact, but of course, a "negative" result does not necessarily mean that the site is safe. 

This move by the Belgian government follows in the footsteps of the American and Chinese governments, which have previously also tried to warn investors about cryptocurrency scams. 

 

Featured Image Credit: "Grand Place, Brussels" by "Dimitris Kamaras" via Flickr; licensed under "CC BY 2.0"