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published in Blogs
Nov 19, 2021

How to Avoid Bitcoin Scams

Before 2017, Bitcoin was mostly the province of cryptocurrency enthusiasts, with little mainstream recognition. But everything changed as prices skyrocketed. New investors jumped into the fray, eager to make their fast fortunes. Keeping with time-honored tradition in any booming market, scammers proliferated, equally keen to fleece neophyte, under-informed investors.

Cryptocurrency investment may seem like a free-for-all, but using a little caution can go a long way. Let’s review some of the most common bitcoin scams, as well as the steps you can take to avoid them.  

Stolen Wallets

Physical wallets are a popular, secure option for storing private keys – whether made of paper or a hardware wallet, like a USB stick, keeping keys offline adds an extra layer of security to investors’ holdings. Users should be careful to store their paper and hardware wallets in safe places, to eliminate the threat of theft. Additionally, investors should research hardware wallet providers to ensure safety and trustworthiness. Vendors hawking “pre-configured” wallets should be looked at especially carefully – a recent scam involved selling hardware wallets with a seed phrase on a scratch card that, while theoretically hidden, are actually compromised, allowing hackers access to funds as soon as the wallets are activated.

Fake ICOs

ICOs, or Initial Coin Offerings, have allowed companies to raise capital without taking VC money, which also generally comes with loss of autonomy. This take on crowd-sourcing is becoming increasingly prevalent, but scammers have also taken advantage of this popular system to separate investors from their holdings through fake websites and compromised wallets. It is vital to research the companies you are considering investing in – pick over the whitepaper with a fine tooth comb, and perform due diligence on the board of directors and other investors to determine a company’s validity.

Exchange Fraud

Like stocks, cryptocurrencies are traded at exchanges. Unlike the stock market, however, regulatory oversight is relatively minimal with virtual coins. This landscape is changing, but as authorities play catch-up, it is important for investors to pay attention to some basics. Discounted coins, offered as incentives to join and trade on an exchange, are a major warning sign – deals that seem too good to be true probably are just that. Non-encrypted exchange websites, denoted by ‘https://’ instead of ‘https://’, should also be avoided to maximize asset security.

Mining Scams

Bitcoin mining requires significant effort and resource investment, creating a high barrier to entry for the average person. Enterprising companies are offering users a chance to mine coins for a set rate, essentially renting existing mining infrastructure for personal use. But users should beware companies guaranteeing blanket returns on investment; coins become progressively more difficult to obtain as more are mined, leading to decreasing returns. Do your homework on each mining company – look for detailed information about operations, measure the level of transparency surrounding the company, and beware of ‘grand promises’.

Pyramid Schemes

Pyramid schemes (also called multi-level marketing schemes), which offer not only quick returns but also increasingly-extravagant perks in exchange for proportionally larger investments, are becoming more prominent in cryptocurrency. Assurances of too-good-to-be-true earnings usually are too-good-to-be-true. Stay away from companies promising the moon, even if you might get a new Apple Watch out of the deal. Read the websites thoroughly, but also look for outside sources that independently validate a company’s claims.

Doing the bare minimum as an investor can save you a world of regret. Solid research, coupled with a healthy dose of skepticism and an immersion in details, will help minimize mistakes and avoid fraud as you embark on your journey in cryptocurrency investment. Trust your gut, vet your options, and keep both feet firmly planted in reality – the more you do so, the better your chance of maximizing your earnings.

Related Ticker: BTC.X

Aroon Indicator for BTC.X shows an upward move is likely

BTC.X's Aroon Indicator triggered a bullish signal on April 28, 2025. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 450 similar instances where the Aroon Indicator showed a similar pattern. In of the 450 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at .

Price Prediction Chart

Technical Analysis (Indicators)

Bullish Trend Analysis

The Momentum Indicator moved above the 0 level on April 12, 2025. You may want to consider a long position or call options on BTC.X as a result. In of 141 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .

The Moving Average Convergence Divergence (MACD) for BTC.X just turned positive on April 11, 2025. Looking at past instances where BTC.X's MACD turned positive, the stock continued to rise in of 61 cases over the following month. The odds of a continued upward trend are .

BTC.X moved above its 50-day moving average on April 17, 2025 date and that indicates a change from a downward trend to an upward trend.

The 10-day moving average for BTC.X crossed bullishly above the 50-day moving average on April 20, 2025. This indicates that the trend has shifted higher and could be considered a buy signal. In of 19 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .

Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where BTC.X advanced for three days, in of 441 cases, the price rose further within the following month. The odds of a continued upward trend are .

Bearish Trend Analysis

The RSI Indicator demonstrates that the ticker has stayed in the overbought zone for 6 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.

The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 15 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.

The 50-day moving average for BTC.X moved below the 200-day moving average on April 07, 2025. This could be a long-term bearish signal for the stock as the stock shifts to an downward trend.

Following a 3-day decline, the stock is projected to fall further. Considering past instances where BTC.X declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .

BTC.X broke above its upper Bollinger Band on April 22, 2025. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.

Market Cap

The average market capitalization across the group is 1.89T. The market cap for tickers in the group ranges from 1.89T to 1.89T. BTC.X holds the highest valuation in this group at 1.89T. The lowest valued company is BTC.X at 1.89T.

High and low price notable news

The average weekly price growth across all stocks in the group was 9%. For the same group, the average monthly price growth was 15%, and the average quarterly price growth was 31%. BTC.X experienced the highest price growth at 9%, while BTC.X experienced the biggest fall at 9%.

Volume

The average weekly volume growth across all stocks in the group was -22%. For the same stocks of the group, the average monthly volume growth was 91% and the average quarterly volume growth was -20%

Fundamental Analysis Ratings

The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows

Valuation Rating:
P/E Growth Rating:
Price Growth Rating:
SMR Rating:
Profit Risk Rating:
Seasonality Score: (-100 ... +100)
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Paper wallets are extremely useful tools – beyond being one of the most popular and secure cold storage methods, they make it simple to transfer coins between owners.You can access the funds on your paper wallet by “sweeping” (or importing) them to either a live wallet (like Trezor or Exodus) or an exchange service (like Coinbase). Most services allow you to import them directly from your wallet’s private key, but there are two key exceptions.
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