Bitcoin scam 2023: the 17 most common scams

Bitcoin Fraud

Bitcoin fraud: About the dark side of the Bitcoin boom. In recent years, bitcoin has attracted a lot of attention due to its high returns. A whole range of fraudulent techniques have established themselves around trading with bitcoin, making it difficult for investors to identify reputable trading platforms. Unfortunately, there is an increasing number of fraud cases in connection with Bitcoin.

For this reason, in this text our lawyers address the current scams of 2023 and the experiences of injured parties. We also present the 17 most common types of Bitcoin scams that occur in various areas such as social media, online dating and automated trading platforms. With this knowledge, you will learn how to protect yourself from Bitcoin fraud and recognise it early.

If you have already been harmed by a Bitcoin scam, we will also provide you with valuable advice in this case. We explain how you can report your fraud case and what technical and legal options are available to reclaim your money.

Table of contents

  • What is Bitcoin Fraud?
  • Bitcoin scam 2023
  • How Bitcoin scams work – experiences of victims
  • The 17 most common types of Bitcoin fraud
    • Fake exchanges and fake Bitcoin platforms
    • Bitcoin scams: Facebook, Instagram, WhatsApp etc.
    • Bitcoin scams via well-known crypto exchanges
    • Fake Bitcoin credits
    • Online dating and Bitcoin scams
    • Bitcoin fraud via trading robots and automated Bitcoin trading
    • Phishing scams
    • Bitcoin scams: fake sweepstakes and donated Bitcoins
    • Bitcoin fraud with “celebrities & Höhle der Löwen” (Shark Tank)
    • Bitcoin fraud through fraudulent phone calls
    • Ponzi Schemes
    • Scam coins – OneCoin and co.
    • ICO scams involving Bitcoin
    • Bitcoin fraud using malware and ransomware
    • Social engineering and Bitcoin fraud
    • Hijacking or remote access through alleged technical support
    • Fraud after Bitcoin fraud
  • How to recognise Bitcoin fraud in time?
  • How to protect yourself from Bitcoin fraud?
    • Inform yourself
    • Verify your trading platform
    • Use a secure wallet
    • Never disclose private keys
  • Report Bitcoin fraud – what should affected investors do?
    • Money back after Bitcoin fraud: the technical and legal options
    • Why does Bitcoin fraud happen so often?
    • Bitcoin fraud cases – current examples
  • Legal remedies in Bitcoin fraud cases
    • Criminal consequences
    • Civil law consequences
  • Why is a lawyer helpful in Bitcoin fraud cases?

What is Bitcoin fraud?

Bitcoin fraud refers to fraudulent activities whose goal is to steal people’s Bitcoins. This type of fraud can take various forms and is often very sophisticated. The perpetrators take advantage of investors’ trust to trick them into transferring their money or handing over their Bitcoins.

Bitcoin fraud can take place not only through direct acts of theft, but also by manipulating or misleading people to get them to make rash decisions.

For example, fraudsters can spread fake news to manipulate the price of digital currencies and trick unsuspecting investors into buying or selling.

Social engineering techniques such as identity theft or fake websites can also be used to deceive victims and steal their bitcoin assets. It is important to emphasise that Bitcoin trading itself is not fraudulent, but it is the perpetrators who abuse the technology to achieve their goals. So let’s take a closer look at Bitcoin fraud methods.

Bitcoin scam via blockchain 2023

As previously mentioned, Bitcoin fraud can be carried out in many different ways. So, as an investor, it is important for you to be aware of the different scam methods. Only then will you have the opportunity to protect yourself from the sophisticated scams.

Some of the most common Bitcoin scam methods are also in 2023:

  • Fraud method using fake credits on the blockchain,
  • Bitcoin fraud via well-known crypto exchanges,
  • fake Bitcoin trading platforms,
  • Romance Scam in connection with Bitcoin trading scams,
  • fake exchanges and wallets,
  • Fake Coins,
  • phishing, ransomware and social engineering.

These scams can spread quickly and are often very sophisticated and convincingly designed to deceive investors and steal their funds. Some scammers even use fake social media profiles and fake testimonials to build trust and deceive their victims.

The criminals are usually psychologically trained so that they appear trustworthy and competent. This is exactly what makes them so successful.

We will go into detail about the Bitcoin scams mentioned here in the rest of the text. But first, let’s take a look at the experiences of victims and a typical Bitcoin scam.

How Bitcoin fraud works – Experiences of victims

Our clients often report Bitcoin fraud via fake trading platforms. While the preceding contact may differ from each other – for example:

  • Advertisement on social media,
  • broker call,
  • alleged insider tips in messenger trading groups or
  • a love scam

the process of the Bitcoin scam is always the same:

  1. Trust is built up through intensive customer support and the supposed competence and expertise of the Bitcoin broker.
  2. High returns and profits “overnight” are promised.
  3. Mostly, people start with an investment of 250 or 500 euros.
  4. Fake diagrams signal to the investor that he has actually generated the promised profits.
  5. He is then motivated to make further investments.
  6. Also common are dubious demands for payments, which are described as tax, commission, proof of liquidity, mirror transaction or the like.
  7. The Bitcoin trader usually only finds out that a fraud has taken place when he demands payment of his winnings.
  8. He is then put off or the payout is tied to certain further deposits.
  9. In most cases, the investments were never used for Bitcoin trading, but transferred directly to the accounts of the perpetrators.

It is important to note that even in this situation, there are possibilities to secure and recover funds together with a lawyer.

Such Bitcoin fraud cases are unfortunately not decreasing. On the contrary, the criminals regularly develop new fraud methods against which it is important to protect yourself.

That is why our lawyers have listed the 17 most common types of Bitcoin fraud in the following sections.

The 17 most common types of Bitcoin scams

By knowing these scams, you can protect yourself from potential scams and ensure that your Bitcoin investments are safe.

I. Fake Exchanges and Fake Bitcoin Platforms

Scammers can create fake Bitcoin exchanges and platforms to trick investors into depositing and investing their money. These platforms often look like real exchanges and offer similar services, such as trading Bitcoin.

Criminals also repeatedly create “clones” of actual existing Bitcoin trading platforms. The company name, trademark and texts are taken over 1:1 and the domain address is minimally changed. You can read about a concrete and current example of a fake crypto exchange here.

The goal of the scammers is to get investors to deposit money and then steal it. Once investors have deposited the money, the scammers can often block access to the account or simply disappear with the money.

To protect yourself from fake Bitcoin exchanges and platforms, always check the regulation and reputation of the exchange or platform before depositing or investing money. Look for reviews and comments from other users to make sure the platform is safe and trustworthy.

But not only that, safeguard yourself additionally by looking for warnings from financial authorities from the EU as well as advice from law firms about the respective provider.

II. The role of social media and messenger in Bitcoin fraud

Facebook, Twitter, Instagram, WhatsApp and Telegram – social media and messenger play an important role in Bitcoin fraud as they provide a platform for fraudsters to reach and deceive unsuspecting victims.

Fraudsters can create fake social media accounts posing as legitimate businesses, organisations or individuals and then send messages to potential victims. These messages may include fake offers, sweepstakes or investment opportunities to gain victims’ trust and get them to transfer money or Bitcoins.

Messenger apps such as WhatsApp, Telegram and Signal can also be used by fraudsters to send messages to victims and trick them into revealing personal information or clicking on suspicious links. Fraudsters can also send fake messages from supposed friends or contacts to gain victims’ trust and get them to transfer Bitcoins.

In some dubious trading groups on Signal, Telegram and WhatsApp, chat members are systematically scammed by being lured to fake Bitcoin platforms or tricked into making reckless trades.

It is important that investors are cautious and do not let scammers persuade them to disclose personal information or click on suspicious links. Investors should also ensure that they only contact legitimate companies or organisations and verify that the request is actually coming from them before giving out personal information or clicking on suspicious links.

III. Bitcoin fraud via well-known crypto exchanges

Bitcoin fraud via well-known crypto exchanges is a growing problem as more and more people use Bitcoins as an investment opportunity. Perpetrators often use well-known crypto exchanges to gain the trust of investors and then take Bitcoin from them.

  • An example of this is the Binance scam, where perpetrators created fake websites and emails posing as official Binance communications and tricked investors into entering their login details on the fake websites. The perpetrators were then able to hack the investors’ accounts and transfer Bitcoin to their own wallets.
  • Another example is the Coinbase scam, where perpetrators created fake Coinbase apps that tricked investors into transferring their Bitcoin to fake wallets. The perpetrators were then able to steal the Bitcoin and deprive investors of their savings.

Our law firm is aware of Bitcoin fraud cases – very clustered from 2022 and 2023 – involving the well-known crypto exchanges:

have been misused by the perpetrators.

It is important to be aware that fraudsters are always developing new methods to deceive investors and steal their Bitcoin. Investors should therefore be careful and only stick to reputable crypto exchanges. It is also important to watch out for suspicious activity, such as emails or websites that claim to be official crypto exchanges but have unusual URLs or spelling mistakes.

IV. Fake Bitcoin credit balances

Often in the course of Bitcoin fraud, false papers are used that suggest an alleged credit balance on the blockchain. In this scam, the scammers promise investors a high credit balance that allegedly occurred due to technical errors.

The scammers then ask investors to pay a fee to transfer the balance to their own wallet. However, when investors pay the fee, they receive nothing, as there is no actual balance and the scammers simply keep the money.

In some cases, the scammers may create fake documents or screenshots showing the alleged balance on the blockchain to deceive investors. These documents can often look very real and are often difficult to detect that they are fake.

It is therefore important for investors to be extremely cautious and not be fooled by purported credit balances. It is also important to verify the identity and credibility of providers and ensure that they are reputable.

V. Bitcoin scams and online dating apps like Tinder

There are increasing cases of Bitcoin fraud that can take place on online dating apps such as Tinder. Fraudsters can create fake profiles posing as attractive people to gain the trust of other users. Once they have gained trust, they may ask for personal information or pretend to have a common interest in Bitcoin.

The scammers may then suggest investment opportunities in Bitcoin that sound too good to be true. They may also ask for help in transferring Bitcoins or pretend that they need help to make an investment themselves. Also, these Romance Scams are often used in conjunction with money laundering. In this way, the victim of the scam is turned into the perpetrator.

It is important that users of online dating apps are careful and do not let scammers persuade them to give out personal information or click on suspicious links. Users should also ensure that they only contact legitimate companies or organisations and verify that the request is actually coming from them before giving out personal information or clicking on suspicious links.

VI. Bitcoin Fraud via Trading Robots and Automated Bitcoin Trading

It is important to note that there are scams associated with Bitcoin trading, including scams involving trading robots and automated Bitcoin trading systems. These scams often promise high returns with minimal effort and claim to be powered by complex algorithms and artificial intelligence.

However, there are many cases where these trading robots and automated systems are actually just scams. In some cases, investors are asked to transfer their money to an account of an unregulated broker or an untrusted exchange, where it is then stolen. In other cases, the trading is indeed automated, but the algorithms are not as sophisticated as claimed and the system turns out to be unprofitable or even a complete scam.

Numerous negative reports from users as well as regulatory warnings from BaFin regarding the Bitcoin trading robots “Bitcoin Code” and “Bitcoin Trader” should be mentioned here.

It is therefore important to be extremely cautious and conduct thorough research before investing in automated Bitcoin trading systems or trading robots. It is also advisable to only invest in regulated exchanges and brokers and stick to established companies that have a proven track record.

VII. The use of phishing in Bitcoin fraud

Phishing scams are one of the most common forms of Bitcoin fraud. It involves tricking unsuspecting victims into using fake emails, websites or social media accounts to steal their login details or private keys. With this information, the perpetrators can access the victims’ Bitcoin wallets and steal their Bitcoins.

To succeed in the phishing scam, the fraudsters often use fake emails that look like they come from a legitimate cryptocurrency exchange or wallet platform. In the email, a pretext is often put forward to get the victim to click on a link or download an attachment that is supposedly important or urgent.

When the victim clicks on the link or opens the attachment, they are redirected to a fake website that looks deceptively similar to the original site. There, they are then asked to enter their login data or private keys. To protect yourself from phishing scams, you should always be sceptical when you receive an unexpected email from a cryptocurrency exchange or wallet platform. Check the sender address and compare it with the original address of the platform.

If you are unsure whether an email is legitimate, contact the platform’s customer service directly and ask. Never reveal your login details or private keys unless you are absolutely sure that the request is legitimate. In addition, you should always set up 2-factor authentication for your cryptocurrency wallet for added protection.

VIII. Bitcoin fraud: false sweepstakes and donated Bitcoins

Fake sweepstakes and donated Bitcoins are also a form of Bitcoin fraud. Fraudsters may create fake sweepstakes where participants are asked to reveal their personal information or pay a small fee to enter the sweepstakes. In some cases, the scammer may also pretend that the prize will be paid in Bitcoins to attract the interest of crypto investors.

Similarly, scammers may also claim that they are giving away free Bitcoins to pique the interest of investors. The scammer may ask the recipient to pay a small fee to receive the supposedly free Bitcoins, or to disclose personal information to conduct a supposed identity verification.

It is important for investors to be cautious and not be persuaded by such offers. Investors should always be sceptical if they are offered something for free or for no consideration. They should also ensure that they only contact legitimate companies or organisations and verify that the request is actually from them before giving out personal information or clicking on suspicious links.

IX. Bitcoin scams with “celebrities & Shark Tank”

Bitcoin scams using “celebrities and Shark Tank” is a scam that focuses on the popularity of television shows and celebrities to gain the trust of investors. Scammers may create fake articles or advertisements claiming that a celebrity or company has invested in a Bitcoin investment opportunity that promises high returns.

The scammers may also create fake social media accounts of celebrities and then send messages to investors claiming that they have invested in a particular Bitcoin investment opportunity and have received high returns.

The Bitcoin scam always follows the same pattern here:

  1. First, an ad is placed featuring the face of a celebrity, for example on social media. This ad acts as a teaser to make the reader curious.
  2. If the reader clicks on the ad, he or she is redirected to a separate landing page that visually appears to be part of a serious media offer. The logos of well-known media brands are often integrated, and the reader is given the impression that this is an editorial article.
  3. In the article, the celebrity reports on the supposedly high prospects of winning. At the same time, a link to the trading platform is placed at several points in the text, where the reader can invest his or her money and receive the Bitcoins in return.

X. Bitcoin fraud through fraudulent telephone calls

Bitcoin fraud by fraudulent phone calls is a common scam where fraudsters call investors and pretend to be employees of legitimate Bitcoin companies. The scammers may claim that the investor’s account has been hacked or that there is a problem with a transaction in order to gain the investor’s trust.

The fraudsters may then ask the investor to reveal their private keys or credentials in order to resolve the problem. Alternatively, they may ask the investor to transfer money to solve the problem.

It is important for investors to be cautious and not be persuaded by such scams. Investors should always be sceptical when they receive unexpected calls and should always do thorough research before transferring personal information or money. It is also important that investors never share their private keys or credentials with third parties, as this would allow fraudsters to access their Bitcoin wallet.

XI. Ponzi scheme as a means for Bitcoin fraud

Ponzi schemes have long been a popular form of fraud and have also found their way into the world of Bitcoin. Such fraud schemes are also known as Ponzi schemes and pyramid schemes. Ponzi schemes work by the perpetrators promising potential victims high returns on their Bitcoin investments. Victims are often asked to invest large amounts of money in the scheme in order to earn high returns as quickly as possible.

The Ponzi scheme works by the scammers paying the returns of previous investors from the deposits of new investors. The scammers often claim that they are able to make exceptionally high returns by trading Bitcoin or other speculative practices.

In fact, most of the money simply flows into the system from new investors to pay off previous investors. In this way, a snowball effect is created where the system attracts more and more investors who are lured by the high returns. Ponzi schemes often collapse when too many investors want to withdraw their money or when there are no more new investors to finance the returns of the old investors.

When the scheme collapses, most investors lose all their money, while the scammers disappear with the stolen funds.

To protect yourself from Ponzi schemes, you should always be cautious when you are promised high returns on investments in Bitcoin. Never invest more money than you are willing to lose and always check the regulation and reputation of the company or platform before investing. If something sounds too good to be true, it probably is.

XII. Scam Coins and Fake Coins

Scam coins are a type of Bitcoin scam where fraudsters create fake cryptocurrencies and try to get investors to put their money into them. Scam coins often look like real cryptocurrencies and can also be traded on legitimate cryptocurrency exchanges. In some cases, the scammers may also launch fake ICOs to get investors to invest in the scam coins.

The goal of the scammers is to get investors to invest in these digital currencies and steal the investors’ money. Once enough money has been collected, the scammers often disappear with the money and the scam coin becomes worthless.

To protect yourself from scam coins, you should always carefully consider which crypto coins you want to invest in. Check their regulation and research their backgrounds and developers. Avoid investing in unknown or new cryptocurrencies that do not offer clear information about their regulation or background.

Bitcoin scam – a woman and her fake coin

There are numerous examples of scam or fake coins. Probably the most famous, not least due to the ARD documentary “Die Kryptoqueen”, is OneCoin and its inventor. OneCoin is an alleged cryptocurrency based on network marketing and a Ponzi scam, managed on a blockchain by the companies OneCoin Ltd (Dubai) and OneLife Network Ltd (Belize). Sebastian Greenwood and Ruja Ignatova founded both companies.

The total global revenue of the OneCoins Ponzi scheme is estimated by the US authorities at over $4 billion. Most of the people responsible for managing OneCoin are either in prison or presumably in hiding.

The distribution of OneCoin in Germany has been banned by BaFin. At least 20 law enforcement agencies worldwide are investigating Ruja Ignatova and OneCoin. Since 11 May 2022, the Federal Criminal Police Office has been searching intensively for Ruja Ignatova, a German citizen.

Some more of the most well-known examples

Bitconnect: Bitconnect was a platform that offered a cryptocurrency called Bitconnect Coin (BCC). It was promised that investors would earn high returns if they invested in BCC. However, Bitconnect was actually a pyramid scheme based on recruiting new investors to pay off older investors. The platform collapsed in 2018 after being charged with fraud by US authorities.

Centra Tech: Centra Tech was a platform that claimed to have a cryptocurrency called Centra Coin (CTR). It was promised that the cryptocurrency would be able to facilitate payments around the world. However, Centra Tech was in fact a scam that was charged with fraud by US authorities.

PlexCoin: PlexCoin was a cryptocurrency created by fraudsters to deceive investors. It was claimed that the cryptocurrency would be able to process fast and secure transactions. However, PlexCoin was in fact a scam that was charged with fraud by US authorities.

It is important to note that there are many other examples of scam or fake coins. As an investor, it is important to carefully research and educate yourself about a cryptocurrency and the technology behind it before investing.

XIII. ICO fraud in connection with Bitcoin

Initial Coin Offerings (ICOs) are a method of funding cryptocurrency projects. Fraudsters can create fake ICOs to get investors to invest in fake cryptocurrencies. The scammers promise high returns, but the cryptocurrency actually has no value.

Another feature of fake ICOs is that scammers often create fake whitepapers or business plans to get investors interested. These fake whitepapers can often look very convincing and contain detailed information about the cryptocurrency project. But in reality, there is often no real technology or no actual developments behind the project.

In some cases, fake ICOs can also be copied from real projects. Fraudsters can use the name and concept of a legitimate ICO and create a fake version to deceive investors. It is important that investors carefully research and verify the authenticity of an ICO before investing. One way is to research the developers of the project and ensure they have relevant experience and a proven track record. It is also advisable to seek the opinions of experts and other investors before investing in an ICO.

XIV. Bitcoin fraud using malware and ransomware

Fraudsters can use malware and ransomware to access investors’ Bitcoin wallets and steal their Bitcoins. This malware can masquerade as legitimate wallet software and trick investors into revealing their private keys or redirect them to a fake website where they then reveal their login details.

Another type of malware that can be used to steal Bitcoin is a so-called “Bitcoin stealer”. This type of malware can infiltrate investors’ Bitcoin wallets and then steal the private keys needed to access the Bitcoins in the wallet. Once the private keys are stolen, fraudsters can steal the funds from the wallet.

It is important that investors are careful and only download legitimate wallet software from trusted sources. Investors should also ensure that their wallets are protected by strong passwords and two-factor authentication to reduce the likelihood of a successful hack. It is also advisable to make regular backups of the wallet and ensure that antivirus software and other security measures are up to date.

XV. Social Engineering and Bitcoin Fraud

Fraudsters can use social engineering techniques to obtain investors’ personal information and hack their Bitcoin wallets. Social engineering can include phone calls, fake emails or fake social media accounts to gain investors’ trust.

Fraudsters can use social engineering techniques to obtain investors’ personal information and hack their Bitcoin wallets. Social engineering refers to manipulating people to get them to reveal confidential information or perform unsafe actions.

An example of social engineering in the context of Bitcoin fraud is the so-called “social engineering hack”. Here, fraudsters call victims and pretend to be employees of Bitcoin companies. They claim that there are problems with the victim’s Bitcoin wallet and that they can help solve the problem.

They then ask the victim to install remote access software on their computer and give them access to their Bitcoin wallet. Once the fraudsters have access to the wallet, they can steal the Bitcoins.

XVI. Hijacking or remote access through alleged technical support

Remote access and hijacking are other common Bitcoin scam methods used to access investors’ Bitcoin wallets. These scammers may pose as technical support from a Bitcoin-related company and claim that the victim has a problem with their account that needs to be resolved immediately.

The scammers then ask the victim to install a recognised remote access software, such as AnyDesk or Microsoft Teams, on their computer to fix the problem. Once the scammers have access to the victim’s computer, they can access the Bitcoin wallet and steal all the funds.

It is important that investors are careful and do not let scammers persuade them to install remote access software on their computer or reveal confidential information. Investors should also ensure that they only contact legitimate companies or organisations and verify that the request is actually coming from them before giving out personal information or clicking on suspicious links.

XVII. The scam after the Bitcoin scam

Another now widespread form of Bitcoin scam: recovery scam, which focuses on supposedly recovering lost or stolen Bitcoins.

Here are some examples and bullet points of how this scam works:

  1. Contacting: the perpetrators make unsolicited contact, often by email or phone, offering their loss recovery services.
  2. Special software: The scammers claim to have special software that is able to recover losses on the crypto market and restore the original investment.
  3. Trading positions: The perpetrators can advertise certain trading positions that supposedly guarantee profits or can compensate for losses.
  4. Tax tricks: Another way perpetrators carry out the recovery scam is by offering tax tricks that can supposedly help minimise or reverse losses.
  5. Fees: The scammers often charge fees upfront before offering their services, and may also offer packages that purport to offer higher chances of success.
  6. In quite a few cases, the fraudsters also falsely impersonate employees of known financial authorities, such as the UK FCA, or law enforcement agencies. The perpetrators forge documents that look deceptively genuine and claim that funds have been seized in the course of fraud investigations and raids. The money would be returned to the rightful owner against the advance payment of a fee.

If this topic interests you, you can find more information here:

Fraud: Alleged offers of help “supervisory authorities”

When scammers imitate authorities: How a lawyer can help you

It is important to be cautious and aware that there is no guarantee that price losses in the crypto market can be recovered. There is also no special software or tricks that can recover or reverse losses. Investors should therefore be sceptical when contacted by anyone offering these services and should always ensure that they are working with a trustworthy and reputable person or organisation.

How do you recognise Bitcoin fraud in time?

It can be difficult to spot Bitcoin fraud early on, as the perpetrators are often very skilled and constantly change their methods. However, here are some signs you should look out for to spot Bitcoin fraud in time:

  1. Unusually high returns: If a trading platform or company promises you very high returns, you should be careful. Bitcoin is very volatile and there is no guarantee of high returns.
  2. Pressure to buy: If you are pressured to invest in Bitcoin quickly, you should be sceptical. Reputable trading platforms and companies should give you time to inform yourself and decide whether you want to invest.
  3. Missing or unclear information: If a trading platform or company does not provide clear information about its regulation or operation, you should be wary. Reputable companies should be transparent and inform their clients about their mode of operation and regulation.
  4. Unusual payment methods: If you are asked to use Bitcoins to pay for goods or services, you should be cautious. Reputable companies usually offer traditional payment methods such as credit cards or bank transfers.
  5. Phishing and scam emails: If you unexpectedly receive an email asking you to give out personal information or private keys, you should be very careful. Bitcoin scammers often use fake emails or websites to steal personal information.

It is also important to always do enough research and make sure you are using a verified trading platform and a secure wallet. If you are unsure whether an offer is reputable or not, seek professional advice from a lawyer or financial advisor.

How do you protect yourself from Bitcoin fraud?

There are several ways you can protect yourself from Bitcoin fraud. In the following, we will give you some tips.

Inform yourself

Inform yourself: Before you invest in Bitcoin, you should inform yourself sufficiently. Understand how the technology works, what risks are involved and how you can keep your investments safe.

As an investor in Germany, you can find out about Bitcoin investments in various ways. Some possibilities are:

  • Financial experts and investment advisors: You can turn to financial experts or investment advisors who specialise in Bitcoins. They can give you valuable insights into the market and investment opportunities and help you make informed decisions.
  • Bitcoin communities and forums: There are a variety of Bitcoin communities and forums online that focus on discussions about the latest developments in the Bitcoin market. Here you can interact with other investors and gain valuable information and insights.
  • News sites: Many news sites report on the Bitcoin market and the latest developments in the industry. Here you can find out about current trends and events and stay up to date.

What should you look out for to protect yourself from Bitcoin scams? Some tips are:

  1. Regulation: always check the regulation of the trading platform before depositing or investing money. Reputable platforms should be monitored and licensed by regulators.
  2. Reputation: Check the reputation of the platform through reviews and comments from other users. Look out for signs of fraudulent activity or if other users have had positive experiences with the platform.
  3. Security: make sure that the trading platform offers security measures such as SSL encryption, two-factor authentication and other measures to protect your personal data and your Bitcoins.
  4. Fees: Check the fee structure of the trading platform to make sure it is fair and transparent. Also look out for hidden fees and commissions.
  5. Customer support: Make sure that the trading platform offers reliable customer support that can help you quickly and effectively with questions and problems.

Indicators of respectability can include: a transparent fee structure, clear information about regulation and licensing, positive reviews and comments from other users, a comprehensive security infrastructure and reliable customer support.

Indicators of Bitcoin fraud, on the other hand, can be: unclear or opaque fee structures, lack of regulation and licensing, negative reviews and comments from other users, an inadequate security infrastructure and poor customer support.

Verify your trading platform

Make sure the trading platform you want to use is legitimate and secure. Check that the platform is regulated by a trusted regulator and that it has positive reviews from other users. Avoid using platforms that do not provide clear information about their regulation or operation.

Verifying the trading platform is an important step to protect yourself from Bitcoin fraud. Here are some additional steps you can take to ensure the trading platform is legitimate and secure:

  • Check the regulation: make sure the trading platform is regulated by a trusted regulator. In Germany, for example, the Federal Financial Supervisory Authority (BaFin) is responsible for regulating financial services, including Bitcoin. Check whether the trading platform is licensed by BaFin or another recognised regulatory authority.
  • Research: Conduct a thorough research to ensure that the trading platform has a good reputation and is rated positively by other users. Look for reviews and comments from other users to see if there are signs of fraudulent activity or if other users have had positive experiences with the platform.
  • Security infrastructure: Make sure that the trading platform offers a comprehensive security infrastructure to protect your personal data and Bitcoins. Look for SSL encryption, two-factor authentication and other security measures.
  • Transparency: Check the transparency of the trading platform. Reputable platforms should provide clear information about their operations, fee structure and privacy policies. Make sure you understand all the terms and conditions of the platform before depositing or investing money.
  • Customer support: Make sure the trading platform offers reliable customer support that can help you with questions and problems quickly and effectively.

Avoid using platforms that do not provide clear information about their regulation or operation. Be sceptical of platforms that promise high returns or quick profits without providing sufficient information or transparency. If you have doubts about the seriousness of a trading platform, do not use it and instead turn to a regulated and trustworthy platform.

Use a secure wallet

Using a secure wallet is another important step to protect yourself from Bitcoin fraud. Here are some additional steps you can take to ensure your wallet is secure:

  1. Hardware wallets: use a hardware wallet to keep your Bitcoins safe. A hardware wallet is a physical device that stores your private keys offline, protecting them from potential hackers.
  2. Cold wallets: A cold wallet is a type of hardware wallet that is not connected to the internet. It offers a high level of security as it is physically separated from the online world.
  3. Software wallets: If you use a software wallet, make sure it comes from a trusted source and offers a high level of security. Make sure the wallet is SSL encrypted and offers two-factor authentication.
  4. Backup: Back up your wallet regularly to ensure that you can access your Bitcoins in the event of a computer crash or loss of the hardware wallet. Store backups in a safe place where they are protected from fire, water or theft.
  5. Password: Use a secure and unique password for your wallet. Avoid simple passwords or those that are easy to guess. Use two-factor authentication here as well.
  6. Avoid public Wi-Fi networks: Avoid using public Wi-Fi networks to access your wallet, as these networks are often insecure and can be used by potential attackers to intercept your private data.
  7. Phishing emails: Be careful not to open emails from scammers or click on links sent by unknown senders. They may try to steal your login details or private keys.

Indicators of a secure wallet can include: a hardware wallet, a wallet from a trusted source, a wallet that is SSL encrypted and offers two-factor authentication, regular backups and a secure and unique password.

Signs of an insecure wallet, on the other hand, can be: a software wallet from an unknown source, a wallet without sufficient security measures, irregular backups, a simple or easy-to-guess password or the use of public Wi-Fi networks.

Never disclose private keys

Keeping private keys secret is another important aspect of protecting yourself from Bitcoin fraud. Here are some additional steps you can take to ensure you never reveal your private keys:

  • Store your private keys offline: Store your private keys offline on a hardware wallet or USB stick. Keep them in a safe place where they are protected from fire, water or theft.
  • Avoid public Wi-Fi networks: Avoid using public Wi-Fi networks to access your wallet or transfer private keys, as these networks are often insecure and can be used by potential attackers to intercept your private data.
  • Be careful with emails and phone calls: Never reveal your private keys if you receive unexpected emails or calls from unknown senders. They may try to scam you and steal your private keys.
  • Phishing websites: Be wary of using websites and platforms that try to steal your login details or private keys. Avoid clicking on links or downloading files sent by unknown senders.
  • Doubts: If you have doubts about the seriousness of a trading platform, wallet or provider, you should not disclose private keys or other sensitive information.

Indicators that private keys should never be revealed can be: private keys should be stored offline, private keys should not be transmitted via public WLAN networks, no private keys should be revealed if there are doubts about the seriousness of the provider.

Signs that private keys could be revealed, on the other hand, could be: the use of insecure WLAN networks, the transmission of private keys to unknown senders or the use of phishing websites.

Reporting Bitcoin fraud – what should affected investors do?

As soon as you encounter difficulties in withdrawing your winnings or something seems suspicious, you should take the following courses of action:

  • Do not make any further payments.
  • Even if it is difficult: Try not to let yourself be pressured.
  • Save evidence such as screenshots and call histories.
  • Seek the support of a lawyer as soon as possible.

If you have been a victim of a blockchain scam, it is important to take certain measures immediately to minimise damages and preserve evidence. First, you should save all communication data between you and the scammers, including emails, phone numbers and chat messages. These can later be used as evidence to prosecute the perpetrators.

In addition, you should take protective measures to secure your devices. Up-to-date antivirus software can help reduce the risk of malware infections. It is also important to reset your login details for your online banking accounts and crypto exchanges to prevent the perpetrators from accessing your accounts.

It is also advisable to remain vigilant as the perpetrators may contact you again under a different identity. If you are contacted by unknown persons, you should be cautious and not give out any personal information.

Finally, you should contact an experienced lawyer and tell them exactly what happened. Many lawyers offer a free initial assessment, which can help you get some initial guidance. A specialised lawyer can help you claim damages and assist in prosecuting the perpetrators.

Have you suffered losses when trading with Bitcoins? Do you suspect that you are dealing with Bitcoin fraud?

Then you can seek investor protection and take advantage of a free initial consultation at our law firm.

Money back after Bitcoin fraud: the technical and legal possibilities

Blockchain technology can play an important role in fraud prosecution. Although fraudsters try to cover their tracks, they still leave digital footprints on the blockchain that can be tracked by law enforcement.

An example of this is the infamous case of the Silk Road marketplace, where illegal drugs and other goods and services were traded on the darknet. Although the operator of the marketplace, Ross Ulbricht, had tried to conceal his identity and activities on the platform, law enforcement was able to track his Bitcoin transactions on the blockchain and eventually arrest him.

Another example is the Bitconnect scam, in which perpetrators tricked investors into putting their money into a Ponzi scheme. The perpetrators used the transparency of the blockchain to disguise their investments, but law enforcement was still able to track their activities on the blockchain and gather evidence to bring them to justice.

Overall, experience shows that fraud on the Blockchain is not completely invisible and that law enforcement agencies are able to collect digital evidence and prosecute fraudsters. Our lawyers are also working with authorities and IT forensic experts. However, it is important that investors act cautiously upfront and are aware that fraud on the blockchain is still a threat.

Why does Bitcoin fraud occur so frequently?

Financial fraudsters have focused on Bitcoin scams because they offer them numerous advantages.

  1. One of these advantages is the speed and efficiency with which they can move large sums of money. Bitcoins can be transferred quickly and easily via the relevant crypto exchanges, which makes it easier for the perpetrators to hide their loot quickly and inconspicuously.
  2. Another advantage is the possibility of document forgery, which is facilitated by the digital nature of the blockchain. Deceptively genuine documents can be quickly created with the help of special computer programs, enabling perpetrators to use forged documents as evidence.
  3. The opacity of the blockchain is deliberately exploited by the perpetrators to take advantage of their own knowledge advantage. Fraud victims are often given wallet addresses to which they have no access, which enables the perpetrators to transfer funds to these addresses and then transfer them quickly and inconspicuously.
  4. The perpetrators also often use complicated-sounding technical details to deceive their victims and get them to invest further funds. These details often have nothing to do with the actual recovery of stolen assets and only serve to confuse victims and distract them from their real intent.

Overall, the blockchain offers financial fraudsters numerous opportunities to disguise their deeds and hide their loot quickly and effectively. It is important to be aware of the risks and protect yourself from scams by educating yourself on how the Blockchain works and being cautious when it comes to financial investments.

Legal remedies in Bitcoin fraud cases

Bitcoin fraud has both criminal and civil consequences. Here is some information on the legal consequences of Bitcoin fraud:

I. Criminal Consequences:

Bitcoin fraud can be punishable as fraud under Section 263 of the Criminal Code (Strafgesetzbuch). Fraud is a criminal offence of deceiving someone in order to cause him or her to perform an act that causes legal detriment or deprives him or her of something of value. In many cases, Bitcoin fraud can be considered as fraud because the perpetrators deceive unsuspecting victims in order to steal cryptocurrencies or money from them.

a) Fraud under § 263 StGB: Here, the perpetrator must cause pecuniary damage to others through acts of deception, whereby the perpetrator seeks unlawful enrichment.
b) Computer fraud according to § 263a StGB: This offence is committed if the offender, by means of incorrect design or use of data, brings about a disposition of property which leads to pecuniary loss.
c) Embezzlement according to § 266 StGB: In this case, the perpetrator abuses his powers or violates his duties, causing damage to the assets of the injured party.

The criminal consequences for Bitcoin fraud can vary from country to country. In Germany, a person convicted of fraud can be punished with a prison sentence of up to five years or a fine. If the fraud was on a large scale or involved a gang, the penalty may be higher.

II. Civil consequences:

Victims of Bitcoin fraud can also take civil action to recover their money or Bitcoins. If you have been a victim of Bitcoin fraud, you can hire a lawyer and file a lawsuit against the perpetrator. In many cases, you can also claim damages.

a) Claims for damages according to §§ 280, 249 ff. BGB: Here, the tortfeasor must have caused the damage negligently or intentionally.
b) Claims for restitution according to §§ 812 ff. BGB: The tortfeasor must have obtained a pecuniary advantage that occurred without legal cause.
c) Enrichment claims pursuant to §§ 812 ff. BGB: Here, the damaging party has gained a pecuniary advantage at the expense of the injured party.

In addition, platforms that have enabled Bitcoin fraud can also be held liable. In Germany, platforms that offer unauthorised financial services can be fined up to 10 million euros.

In any case, victims of Bitcoin fraud should act quickly and contact a lawyer to discuss their legal options.

Why is a lawyer helpful in a Bitcoin fraud case?

A lawyer can be very helpful in a Bitcoin fraud case as he or she has the necessary legal knowledge and experience to help victims of Bitcoin fraud recover their money and claim damages.

Here are some reasons why a lawyer can be helpful in a Bitcoin fraud case:

  1. Advice: a lawyer can give you comprehensive advice on your legal options if you have been a victim of Bitcoin fraud. He or she can help you evaluate the case and recommend the best legal action to take.
  2. Enforcing claims: A lawyer can help you enforce your claims by filing a lawsuit against the perpetrator or claiming damages. The lawyer can help you substantiate your claims and plan the legal steps needed to enforce your claims.
  3. Expertise: A lawyer has the necessary expertise and experience to guide you through the complex legal process. He or she can help you meet the deadlines and procedures required for your case and help you prepare documents and other necessary steps.
  4. Negotiation: A lawyer can help you negotiate an out-of-court settlement with the offender or the platform to find a quick and fair solution. The lawyer can help you negotiate the terms of the settlement and ensure that your interests are protected.
  5. Representation in court: If your case goes to court, a lawyer can represent you in court and defend your interests. He or she can help you present your claims and evidence and try the case in court.

Our lawyers will file a criminal complaint for fraud with the relevant police authority on your behalf. Furthermore, our lawyers at the Herfurtner law firm will examine your documents and explain to you which legal measures you can take in case of Bitcoin fraud and which possibilities we see to recover your stolen Bitcoins.

It is important to act as quickly as possible. The sooner you get a lawyer involved, the better chance you have of getting your funds back. However, even a Bitcoin fraud that is only detected after years is not a lost case per se. Our lawyers will provide you with a case-by-case review.

Bitcoin fraud money back: Even if the provider is located abroad, there is a chance to get your lost investment – or part of it – back. For many years now, the Herfurtner law firm has been supporting affected investors who have fallen for a Bitcoin scam.

We offer a free initial consultation throughout Germany and in German-speaking countries. To arrange an appointment with us, please click here to contact us directly.

If you have invested in or made payments to one of the companies on this list, our lawyers will be at your disposal at short notice.



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