When using crypto payments, it’s important to pay attention and stay vigilant. There are no payment protections like chargebacks since all transactions are final and irreversible. That is why it’s important to take precautions before making any kind of crypto payment. There are several steps you can take to protect yourself from falling victim to a cryptocurrency scam. Let’s talk about what you can do and the most typical scammer tactics when it comes to crypto payments.
- Every user should conduct thorough research when choosing a crypto platform, seeking investment advice, and communicating with service providers.
- Most common scammer tactics include fake investment, exit scams, and impersonation scams.
- Reputable platforms like NOWPayments have zero tolerance policies for fraudulent activity and scams.
5 Things to Do When Paying with Crypto
Do Your Own Research
Let’s get this out of the way: the first rule that every cryptocurrency user must learn is to always do their own research. Make sure the other party is reputable and trustworthy before using any new platforms, purchasing digital currencies, or sending payments for goods and services. A good starting point would be to do a quick online search and read some reviews. However, beware of look-alike websites and applications and dishonest reviews. Always take online information with a grain of salt.
Carefully pick which wallets to use
It’s essential to have a secure crypto wallet to make crypto transactions. You should be absolutely certain that your digital wallet was created and is maintained by a reputable company with a solid track record. Make sure you read all the terms of service and find out if there is a way to contact the team if any issues arise.
Use the security tools provided by crypto wallets, like two-step authentication and additional PINs for outgoing transactions. Using several wallets or even offline cold storage devices can provide additional protection. By doing this, you can prevent total loss in the event that one of them suffers a breach.
Don’t trust unsolicited advice
There are plenty of self-proclaimed crypto experts and influencers who give out advice online. Double-check any information source whose advice might be influenced by other factors. Many public figures are paid to promote particular projects. This doesn’t imply that the project can’t be trusted; it just suggests that the review might not be entirely honest.
Scammers may also approach you unprompted with an investment opportunity or to resolve some issue you may have. Usually, professionals do not approach others through unofficial channels. Make sure that whenever you speak with the user support team of the crypto payment processing platform you use, you are doing so privately and through authorized channels.
Beware if it’s too good to be true
Scams involving cryptocurrencies frequently make claims of unrealistically high returns on your initial investment. Any business promising quick wealth through investments is probably a scam. Another similar scam tactic is giveaways. By promising you a chance to win a sizable sum of money, these con artists will persuade you to “verify” your address by sending cryptocurrency to the fake giveaway. Of course, there is no real prize to win.
Use official resources
False emails, applications, and websites are the main means by which cryptocurrency users are scammed. Some fake cryptocurrency apps can even be available to download through Google Play and the App Store before they are removed. Fake websites might imitate crypto exchanges and wallets. Always double-check the website you are on, verify the email address of the sender, and only download applications through official websites.
The Common Crypto Payment Scams
Now that we’ve described steps to avoid crypto payment scams, let’s discuss the most common tactics used by scammers.
Fake investment. The victim is contacted by people claiming to be professional investors. With high returns promised, the user sends an initial amount of crypto. Scammers then continue to ask for more transactions to recoup some of their initial losses and make even higher returns. Often, the victim is asked for repeated deposits in order to withdraw any funds.
This is the most devastating scam for new cryptocurrency users who do not know how to trade for themselves. Hoping for professional help, they lose large amounts, sometimes in multiple transactions. In order to get their money back, they often also find other scams that promise to battle the initial company. Remember that reputable crypto exchanges usually do not give investment advice.
Exit scams. Cryptocurrency project developers may defraud investors by promising high returns, then taking the money and abandoning the project. This fraud may involve an ICO and a pump-and-dump coin. It also occasionally involves a Ponzi scheme variation, in which investors gain by enticing new users with fake financial incentives.
Impersonation scams. Scammers frequently assume identities that you trust, such as those of your provider of crypto payment services, a potential client or employer, or even the government. You may be told that there is a problem and you need to make a crypto transaction to resolve it. This scam may also include a form of phishing with fake links. Clicking any links in the fraudulent email or on a fake webpage may give scammers access to your device or wallet.
NOWPayments Zero Tolerance for Scammers
NOWPayments strives to protect our clients from any type of scams and fraudulent activities that exist in the crypto industry. We do not want our platform to be used for any illicit purposes, so we always watch out for any concerning activity. The safety of crypto transactions remains the top priority for our team.
For security reasons, NOWPayments does not have access to a merchant’s cryptocurrency wallet as a provider of cryptocurrency payments. However, if we detect fraudulent activity, the suspicious account will be blocked from using our services.
How to Safely Accept Crypto Payments
Follow these easy steps to start accepting cryptocurrency payments with NOWPayments:
- Create an account on the official NOWPayments website using your email address and a secure password.
- Verify your email address via the code sent by email. Log into your account to access the NOWPayments dashboard.
- Select Payment settings from the Settings menu then add your cryptocurrency wallet address.
- Create a Payment link in the Payment tools. Choose payment method, price, and whether a fixed rate payment and a customer-paid fee should be applied.
- Your customers can now receive the permalink, and payments will be deposited directly to your cryptocurrency wallet.
You can see from the aforementioned tips and examples that to avoid becoming a victim of a crypto-related scam, you need to be aware of the typical ways that con artists attempt to steal your information and ultimately your money. With more experience, it becomes easier to spot the scam and stay away from it. However, even seasoned crypto users have to exercise daily caution and only use reputable crypto payment service providers.