Bitcoin Forex Scam
Bitcoin Forex Scams remind us of those old commercials for Reese’s Cups. One person walks around eating a candy bar. Another person has an open jar of peanut butter. They collide and guess what? A new taste sensation. Think of a bitcoin scam running into a forex scam. Viola! We have a bitcoin forex scam.
We wish bitcoin forex scams were only the flavor of the month. Instead, both bitcoin and forex are here to stay. There are very few absolutely new types of scams. Instead, fraudsters recycle strategies and formats, even though they have shiny new names (probably not their own).
What Is a Bitcoin Forex Scam?
A bitcoin forex scam is a hybrid fraud. It could either be:
- A forex broker that takes only bitcoin or other cryptocurrencies as payment
- An unregistered broker that offers fake trading of both forex and cryptocurrencies
There’s no doubt that these fraudsters simply decided to feature bitcoin or forex to grab the public’s attention. These are great keywords and anyone can claim to offer to trading of forex or bitcoin or to accept cryptocurrencies. The only thing they really need to do is persuade people they actually these services. Scam brokers don’t offer any services, but they can be persuasive.
The Problem of Bitcoin Scams
Digital currencies, according to some financial experts, represent the next phase of money. Others in the financial sector are more skeptical and think of cryptocurrencies as inherent frauds. In fact, many people are asking, “Is crypto a scam?”
While it’s an exaggeration to think that all digital currencies are inherently fraudulent, there is one thing that even crypto enthusiasts have to admit–there are more crypto scams than legitimate digital currency opportunities.
This sad fact may change, but as things stand, crypto scams are the fastest-growing type of fraud, according to the FBI. Governments worldwide are finding ways to regulate digital currencies and central banks even consider issuing their own. However, for the time being, the blockchain creates a cover for many types of bitcoin scams.
Because of the anonymity of the blockchain, virtually anyone can set themselves up as brokers or merchants and take payments. There are no names or addresses associated with these anonymous bitcoin wallets. To get a bank account or a credit card, you need to provide information. However, the blockchain asks no questions and has become a hiding place for crypto scams.
The Problem of Forex Scams
“Forex” is another word that tends to be associated with scams. However, like bitcoin, that doesn’t mean that every forex service is a fraud. Look on the website of regulated brokers and you may find that they offer forex trading.
That doesn’t mean they are shady. However, a broker does seem shady if the only kind of trading they offer is forex, bitcoin, and other fashionable and high-risk assets.
Forex trading is actually just trading currency pairs. Forex traders are betting on one currency performing better than the other or vice versa. We kind of do this when we travel and think about the best time to change money.
Forex may sound simple enough, but it’s more complicated than it may seem at first glance. Although it’s easy to understand the concept of forex trading, it’s a challenge to make money at it. That’s because, unlike stocks, the forex market doesn’t rise and fall based on the fundamentals of companies. Forex relies almost entirely on outside factors that can turn on a dime.
Military conflict, a natural disaster or a country buying up huge amounts of another country’s currency unexpectedly can shake the forex market without warning. Although the stock market is affected by these factors to some degree, forex is absolutely vulnerable to these types of events.
Therefore, any forex broker that guarantees you’ll make a killing in the forex market is lying. No broker can guarantee returns for clients and forex brokers who make promises are most likely nothing more than forex scams.
How to Watch Out for Bitcoin Forex Scams
So how do you know whether a forex broker or bitcoin trading is a bitcoin forex scam? The following are some red flags:
- Not licensed
- Offers trading only of cryptocurrency or forex or other high-risk assets
- Accepts only cryptocurrency as a payment option
- Allows clients to withdraw money only in certain crypto tokens
- No transparency
- Vague terms and conditions
- High fees
- False guarantees
- Won’t allow withdrawals unless the client trades a certain amount or pays phony “tax” or huge fees
- Regulator warnings
One of the biggest red flags of a scam broker is the lack of a license. There is absolutely no reason anyone should be offering brokerage services without a license. Period. If they don’t qualify for even a mediocre license, they shouldn’t be a broker.
A broker that only offers high-risk forex or bitcoin trading is trying to attract unsophisticated traders motivated by desperation and hype. Also if the assets are high risk, they can claim there were losses when in fact they absconded with the money.
Cryptocurrency is difficult (but not impossible) to recover. It’s not as easy as getting a credit card chargeback. Therefore, scam brokers are more likely to ask for money in cryptocurrency only or worse, a fake token that has no real value.
Scam brokers don’t want people to know who they are. They disguise their identities and offer fake promises to attract clients. They charge huge fees because they assume their customers don’t check and see what is the reasonable range for fees.
Also, if a regulator has warned about the broker, pay attention and don’t think of opening an account with them.
If You’ve Lost Money to Bitcoin Forex Scam, Talk to Us
Broker Dispute professionals are the people to contact if you suspect you’re dealing with a scam broker or another type of fraud. We have the expertise and the technical solution to unmask information about crypto scams. We will launch an investigation and create a report that will boost your claim and assist you with fund recovery.