How to tell if a Bitcoin website is a Scam

Since the start, like any other emerging industry, Bitcoin has seen thousands of scams and nefarious schemes built to steal your money.

To stay safe in this rapidly growing market, your best bet is to familiarise yourself with the most commonly observed Bitcoin scams to help protect yourself and your digital assets. Take our quiz here to learn about some of the common scams we hear about.

If you are ever dealing with a website to buy, sell, or invest cryptocurrencies, it is very important to make sure you are dealing with a legitimate site.

There are several ways that can help you tell if a Bitcoin website is legit. Follow the checklist below to make sure you are dealing with a genuine, reputable service.

Has anyone else used the service?

You can easily tell if anyone else has used their service by checking the following:

  • Do they any reviews outside of their website? E.g Trust Pilot, Google Reviews, Facebook Reviews.
  • Do they have a Facebook/Twitter account, and is it active? Do people engage with their content?
  • If you Google search ‘[company name] Scam’, do you find anything negative? if you don’t find anything at all, this is suspicious too.

Reviews on their website can be easily fabricated, so keep that in mind when basing your conclusion off reviews shown on potential scam websites.

Are they a registered business and a registered financial services provider?

For New Zealand based companies:

  • Can you find their business on the NZ business registry?: https://companies-register.companiesoffice.govt.nz/
  • Does the NZ business register link back to the website that is claiming to be for that company? Remember that even if the business is listed on the NZ business registry, you could be looking at a fake site, pretending to be that business. Anyone can also register a business too, so this factor is not something you can solely base your research off.
  • Are they a registered financial services provider in NZ?: https://fsp-register.companiesoffice.govt.nz/

Any business dealing with money or crypto in New Zealand will need to be on this list due to regulatory obligation.

For international companies:

  • Most countries will have a similar register you can search – for example if the website says they are based in the UK, you can search the UK Financial Services Register here.

Is there an international warning about the business?

You can easily search the name of their company in the top right-hand corner search bar, but beware, just because they don’t list here doesn’t mean they are safe.

Do they have any celebrity endorsements?

  • Have they been endorsed by celebrities or on the morning breakfast shows or something similar? If so, there is an extremely high chance they are a scam.

These “endorsements” aren’t real, someone has simply taken a photo (or video) of this celebrity or TV show host and doctored it to make it look like they are endorsing that product.

Who owns the website and is it based in the country that they claim to operate from?

This is a very important factor you need to consider. Here is me tracking down the geolocation of the scam company ‘Coinfamily.co.nz’:

Gif of bitcoin scam website coinfamily.co.nz

As you can see, the domain was created in India, indicating that coinfamily.co.nz is clearly a scam.

Anybody can easily plant a trust seal on their website:

Trust seals of various companies

Any website creator can easily publish one of these approval stamps on their website, making them appear to be legit. These are, however, meaningless in your mission of identifying if a Bitcoin website is a scam.

 

Hey look the president of the United States of America just approved of EasyCrypto.nz!

Just kidding, I put that there myself, just like how any scammer would be enticed to do if there were trying to trick people into thinking their Bitcoin website is legit. 😎

If you run into any sketchy websites, feel free to let the search engine gurus know of your sweet find:

If you think you are in a situation at all where you are being scammed, please use our multichoice quiz to find out more.

Otherwise, please contact us here so we can take a look at it ourselves. 🙂

Stay Safe!