17:52 GMT11 May 2021
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    The price of popular digital currency Bitcoin rose above the value of an ounce of gold at the beginning of March, and according to a report released Thursday, this has sparked a concurrent uptick in Bitcoin-related scams in the past three weeks in social media posts and websites.

    In a report, "Bitcoin Scams on Social Media: The Dark Side of Digital Currency,"

    ZeroFOX, a cybersecurity firm based in Baltimore, Maryland, found more than 12,000 instances of online fraud in four categories: phishing, flipping, pyramid schemes and malware.

    "In the days and weeks following the news that a single Bitcoin was worth more than its weight in gold, we analyzed data caught by this rule to ascertain how often Bitcoin scams were being spread over social media and beyond. To date, we’ve identified 3,618 Bitcoin scam URLs. We measured how often posts containing these URLs were shared over a three-week period in early March, and discovered a total of 516 shares averaging 24.53 shares per day," the report reads. 

    One method simply dupes the user into handing over their Bitcoin key by purporting to check whether the number exists in its database, while another lures people to malicious sites they claim contain Bitcoin surveys but actually spread malware on the device that could result in Bitcoins being stolen.

    A "flipping" scam usually promises to double a user’s Bitcoin investment or promises to exchange the cryptocurrency for cash, all for a small fee, before vanishing with the user’s Bitcoins.

    "Bitcoin prices reaching new highs make the currency more tempting both for scammers and for their new potential victims," senior ZeroFOX Data Analyst Phil Tully told the International Business Times. "It coincides with its growing use within populous countries that currently either have unstable currencies like Venezuela, have enacted fast changes in monetary policies like India, or have a problem with large amounts of capital outflow like China." 

    These scams can reach hundreds of thousands of people through social media, and ZeroFOX found that more than 126 million fraudulent websites were shared on various platforms.

    "Social media provides instant and broadcastable access to a plugged-in cohort of netizens that are most likely to be aware of Bitcoin’s hype, but who also lack the savviness to be able to tell a fake offer from a legit one," Tully said. "Whether programmatically or to the naked eye, many of the scam URLs we’ve encountered are impossible to diagnose until transactions are actually followed through, meaning that undeterred scammers can continue to target new victims absent a centralized database of user-confirmed knowledge."

    Bitcoin is not controlled by any government or bank. It’s anonymous and decentralized, making it the currency of choice for purchases of illegal items made online.

    ZeroFOX make several recommendations on how to protect one’s Bitcoins, including not making transactions through through direct messaging, avoiding any site offering something that sounds too good to be true, and being careful to avoid people impersonating legitimate Bitcoin brokers.

    Related:

    Extensive Bitcoin Use 'Could Disrupt Financial Stability' Unless Restricted
    Dutch Police Arrest Ten Over Alleged Use of Bitcoin to Launder Money
    The Search for Bitcoin's Creator: Where in the World is Satoshi Nakamoto?
    Top Banks Conduct Experiment Using Bitcoin, Once Created to Replace Them
    Ponzi Schemes: From Wall Street to Bitcoin Era
    Tags:
    Social Media, Bitcoin scam, Bitcoin, US
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