📢 Peer-to-peer (P2P) crypto transactions have recently gained popularity due to their convenience and ease of use. However, it is important to know the potential risks associated with P2P operations.
We have prepared this guide to provide insight into common P2P scams in currency transactions.
We'll also explore some basic tips to protect yourself from falling victim to these fraudulent activities
Can someone scam you using P2P transactions?
Yes, scammers can take advantage of P2P operations to defraud unsuspecting victims.
They may use sophisticated methods to manipulate transactions, distort payments, or impersonate reputable platforms or individuals.
By understanding common P2P cryptocurrency scams, you can reduce your risk of falling prey to these fraudulent schemes.
How do encrypted P2P scams work?
P2P scams exploit the trust and anonymity inherent in peer-to-peer transactions.
Scammers use various techniques to scam individuals and trick them into releasing money or sensitive information.
Understanding these scams and staying vigilant to protect your money and digital assets is crucial.
What are common P2P crypto scams, and how to spot them?
Proof of payment fraud
Fraudsters can digitally manipulate payment screenshots to falsely claim that they have fulfilled their part of the transaction.
They pressure you to release funds or digital assets without verifying that payment has been received.
SMS scams
SMS scams are a type of proof of payment scam where scammers send victims SMS messages that look similar to notifications sent by banks or wallet apps. The messages falsely claim that the victim has received payment from the counterparty.
Here's how to protect yourself from proof of payment scams:
1. Always check your bank account or e-wallet to confirm receipt of funds before marking the transaction as complete.
2. Be careful and suspicious if the counterparty insists on releasing funds before confirming payment has arrived.
3. To avoid falling for SMS scams, always verify receipt of funds by checking your bank account or cryptocurrency wallet directly instead of blindly trusting the content of the text message.
Chargeback fraud
Fraudsters initiate chargebacks, withdrawing payments made to their counterparties.
They may use third-party accounts to process payments, making it easier to cancel transactions.
One example of this is a counterparty offering to pay you by depositing a check.
That's because requesting a chargeback on check payments is easy, which likely makes it a scam.
To avoid chargeback scams:
1. Make sure that the buyer's name on the payment details matches their verified name on the P2P platform.
2. Do not accept payments from third-party accounts, as they pose a higher risk of chargeback.
3. If someone insists on paying by check, take it as a red flag and file an appeal immediately.
Man-in-the-Middle (MitM) scams.
In this scam, the fraudster pretends to be a reputable trader on Binance, KuCoin, Bybit, etc. and communicates with victims through external channels, such as Telegram, WhatsApp, or social networks.
They provide their bank account details and a link to the P2P ad and ask victims to confirm by copying them into the P2P chat on the order page.
Unknowingly, the victim shares the scammer's bank account details with an unrelated buyer on the Crypto P2P platform, who also has no idea about the scam.
The victim issues cryptocurrencies to the unrelated buyer, who sends their funds to the scammer's bank account instead.
Canceling the transaction or having the customer service team intervene and solve the problem is impossible in such cases.
Since the victim contacted the scammer and obtained the details via an external connection outside the Crypto Exchange platform, and the funds were transferred to a third-party account not connected to Crypto Exchange Merchant, Crypto Exchange customer support cannot provide a solution.
To protect yourself from MitM scams, you must:
1. Communicate only within the P2P platform and avoid engaging in transactions outside it.
2. Remind buyers that third-party transfers violate P2P transaction policies.
3. Double-check the counterparty's bank account details directly on the Crypto Exchange platform.
4. Do not trust offers or information on external channels when making P2P trades on the Crypto Exchange Platform.
To avoid becoming a victim of triangle scams while trading P2P, you should:
1. Confirm receipt of all funds from pending P2P transactions before releasing any assets.
2. Be careful with proof of payment provided by counterparties, as scammers may try to reuse it.
Digital currency platform
Scammers impersonate Crypto Exchange employees to scam users and steal their money.
They contact potential victims through unofficial emails or social media accounts, request personal information and initiate fraudulent transactions.
They may ask you to share your email address in the P2P chat window, claiming that the Crypto Exchange's P2P escrow service needs this information to confirm payment. They can then send you a phishing email similar to official Crypto Exchange communications and trick you into releasing your cryptocurrencies first to receive payment.
To stay safe from scams on Crypto Exchange platforms, do the following:
1. Crypto Exchange will never ask you to complete a P2P transaction via email.
Always release funds only after receiving payment through the P2P platform.
2. Never share personal information or offline contact information in chat.
3. Ensure that payments are submitted using the counterparty's designated payment method and that the name on the account matches the name of the verified counterparty on the Crypto Exchange platform.
4. Be wary of outside offers or information received through unofficial channels.
5. You can check the official verification center of the Crypto Exchange platform to ensure the authenticity of the relevant channels.
Conclusion
• Although P2P transactions offer convenience, it is essential to be aware of common scams and take precautions to protect yourself.
• By understanding how these scams work and following the security tips provided, you can reduce your risk of becoming a victim of P2P fraud in the cryptocurrency market.
• Be vigilant, question offers that seem too good to be true, and always check transactions and payment receipts before releasing any funds or digital assets.
• By following best practices, such as conducting transactions within the Crypto Exchange chat system, double-checking payment details, and reporting suspicious behavior to customer support, you can reduce the risk of falling victim to P2P crypto scams and protect your investments.
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