The 5 Worst Bitcoin Scams

When the Bitcoin first came along, one of its biggest draws was the use of blockchains to make the currency secure in our digital world. Unfortunately, digital wallets are still open to hacking, and people are still open to scamming — so, so much scamming.

To get an idea of how bad it can get, let’s take a look at the biggest Bitcoin scams in history, and the often-ridiculous reasons that they happened.

The Massive Mt. Gox Disaster

You may have already heard about Mt. Gox. It’s easily one of the most infamous crashes in Bitcoin history, a tangled knot of mistakes, corruption, and fraud. Back in the early 2010s, Mt. Gox was a Bitcoin exchange based in Tokyo that handled the majority of Bitcoin transactions around the world, because people thought it was safe.

Unfortunately, Mt. Gox proved to be anything but secure. Within a few short years it faced several massive successful hacking attacks, payment processing issues, governmental investigations, and a massive bank run as people tried to withdraw their funds (and found it might not even be possible).

Ultimately, Mt. Gox gave up. In a devastating blow to the Bitcoin market, the company filed for bankruptcy and announced that it had totally lost around 850,000 Bitcoins, worth about $450 million dollars at the time, or nearly $8 billion at today’s usual market value. Oops!

Of course, hackers didn’t make away with all of it — in fact, it’s hard to tell just how much money was hacked because of security issues, and how much was simply stolen by Mt. Gox representatives. Millions and millions of dollars were lost to fraud, embezzlement, and other illegal acts made by company agents and partners. It will probably be years before we know just how deep the scamming went.

The Optioment Ploy

Ethan Miller/Getty Images

One of the worst types of cryptocurrency scams involves a fake ICO (initial coin offering). The equivalent of a company going public, an ICO occurs when a business first starts selling its cryptocurrency.

Most ICO scams use basic investment fraud, a.k.a. “We promise we’re a super-real and very successful company!” when the company doesn’t actually exist and has no plan to make a profit. More advanced ICO scams may even pretend to be other, real cryptocurrency organizations to confuse buyers who are searching online.

Bitcoin Savings and Trust was even more blatant: It started out as an ICO scam based around a simple Ponzi scheme, and then…kept on going. Unwitting investors were promised amazing returns like 7 percent per week, and ultimately more than 265,000 bitcoins were stolen via fraud. The whole Savings and Trust scheme finally collapsed in 2012, and the organizer Trendon Shavers was caught up in court battles for years: This eventually led to his imprisonment and a $40 million fine. Too bad the bitcoins that he alone stole were worth around $97 million at the time of his sentencing.

Silk Road’s Ridiculous Email Trap

Silk Road, one of the most famous (and seedier) sites on the Tor network

“Wait, Silk Road wasn’t exactly a scam, was it?” you may be wondering, and you would be correct. Silk Road was an infamous black market for trading drugs and other various illegal things on the Dark Web. Most importantly, it was taken down by the FBI and other law enforcement organizations…which actually helped to cement Bitcoin as a legitimate currency that governments cared about.

Then things went a bit wrong. Specifically, the government agreed to auction offer the Bitcoins seized from Silk Road (something that commonly happens to harmless seized goods), so it contacted potential participants to let them know about the auction and ask if they were interested in signing up. Unfortunately, due to a classic “bcc” email mistake, all potential bidders could see everyone the email was sent to. That list was quickly copied, sold and stolen.

The result was a wave of scam emails sent to all these people who were already interested in buying Bitcoins. Phishing schemes like this one pretended to be from the government or related agencies, seeking out sensitive financial information that allowed the scammers to steal Bitcoins from those participating. It wasn’t the greatest way to end the Silk Road case.

Canadian Bitcoins and the Simplest Scam

NurPhoto/Getty Images

The worst scams are those that no one should fall for, but somehow work anyway. This happened to Canadian Bitcoins, an exchange that was used to—as you might guess—manage Bitcoins for Canadian investors. Back in 2014, the exchange was expertly hacked, and at least $100,000 dollars worth of Bitcoins were stolen.

So, where does the scam come in? Well, CB had leased out some space at a Rogers Data Centre for important server hardware, the sort of hardware you could use to hack into the exchange. The data center fell for what might be the oldest scam in the book, right behind, “Hey, what’s that over there!?”

A hacker sent a message to Rogers Data Centre that (basically) said, “Hello, I am the CEO of Canadian Bitcoins. My name is James Grant. I need all your security codes.” Rogers verified that the CEO of Canadian Bitcoins was indeed named James Grant, then sent the hacker all the security codes they needed. No one ever checked to see if the message had really been from Grant, or asked for any kind of confirmation, or, you know, tried to contact Grant through professional channels. You can imagine how displeased investors were when they found out.

Bitcoin Gold and False Promises

Steve Garfield/Flickr

Bitcoin gold was a project designed to create a new form of cryptocurrency that also tapped into the Bitcoin name. That branding trick was a little shady, but nothing was particularly illegal.

Then, expert scammers built a website called “mybtgwallet.com” which offered users a once-in-a-lifetime opportunity to generate Bitcoin gold wallets. All they had to do was submit their private keys used to protect their cryptocurrency wallets!

Needless to say, people shouldn’t have fallen for such an obvious scam, but apparently the website looked convincing to a lot of buyers. More than $3 million in Bitcoins were stolen by the scammers, along with a number of other cryptocurrencies. Even the creators of Bitcoin cold were roped into the scam and actually endorsed the website on its Twitter account before realizing it was all one big con. Remember, it’s really easy to lie online.

Editors’ Recommendations

• Hackers steal as much as 10 percent of new cryptocurrency funds
• Japan’s Coincheck will refund $400 million in stolen cryptocurrency tokens
• The old “Nigerian prince” scam is back on Twitter — with a Bitcoin twist
• A fake startup uses initial coin offering to steal $2 million in digital coins
• Mining Bitcoin in the cloud is like renting a money printer and yes, it’s bizarre

Today’s best deals you won’t want to miss

Whether you’re looking for new tech gear or household items, we’ve got you covered.

Right now there are great discounts on Joby’s GripTight GorillaPod, Vizio’s 50-inch 4K TV, the Hyperkin RetroN 2 gaming console and so much more!

View the rest of the deals

If you want to know about the deals as soon as they are happening, you’ll want to follow Thrifter on Twitter, and sign up for the newsletter, because missing out on a great deal stinks!

Grab a Samsung Galaxy S9 for $595 from Boost Mobile right now

Great deal for prepaid customers.

Using the coupon code LUCKY, you can score a sweet discount on Samsung’s Galaxy S9 from Boost Mobile. You will need to be a customer to take advantage of this deal, and the device is locked to the carrier. Right now, Boost has single line plans starting at $35 a month or family plans starting at $25 a line, and porting your existing line over is pretty simple.

Not sure if Boost Mobile will work for you? Be sure to check out the carriers coverage map and then find the closest store so that once you receive your order you can get it activated with ease.

This is the lowest outright price we’ve seen so far on the Samsung Galaxy S9 and no trade-in is required to take advantage of this deal.

See at Boost Mobile

From the Editor’s Desk: Manual focus

When everything is automatic, sometimes you have to spend extra time doing it yourself.

I learned to drive in an old Volkswagen Golf with a manual transmission. Instead of racing around the city of Toronto like the racecar driver I imagined myself to be, I spent the afternoon in an empty parking lot trying to figure out how to smoothly change gears. As the late summer sun set in the west, I gingerly drove the car up a slight hill toward a not-too-busy street, confident that I could navigate —physically and intellectually — the mortal task of living with other vehicles on unforgiving roads. I turned into traffic without issue, but as I approached my first red light, everything I’d learned over the last four hours escaped me, and as I slowed I forgot to depress the clutch, causing the engine to stall just as I was ready to proceed. Every inch of road was filled with cars seemingly bigger and more intimidating than mine, and inside them were people ready to murder me for delaying their dinners. I panicked, pressed my leaden foot on the gas pedal and, when the car did nothing, felt like I was going to die.

Photography is beautiful because it forces you to humble before the tool itself even as your goal is to let the result speak for itself.

I made it out of there unscathed and, years later, remember that moment fondly. The tool I was using betrayed me, not because it was poorly made, but because I didn’t know how to use it. That’s how we learn; no one starts out a prodigy. The more difficult something is to master, and the longer it takes to get there, the more satisfying it is to reach. I no longer drive a manual car, and by extension, I don’t try to improve my driving. The activity is, to me, an occasionally pleasant and often frustrating necessity. But were I to begin driving manual again — who knows, maybe I’d begin to love it.

The memory of my failed first driving attempt came back to me earlier this month as I woke up at 4 am to take photos of animals in a small game park northeast of Johannesburg in South Africa. I’ve always enjoyed the technical aspects of photography, the relationship between sensor size, aperture, focal length, light sensitivity, metering, shutter speed, and physical proximity to an object. I’ve long derived tremendous pleasure from taking photos of my friends and family, balancing the needs of left and right brain to extract a beautiful photo that is also timeless. But as I built up the institutional knowledge to balance a subject as both emotionally and technically significant, it became quickly apparent that I would need to override the camera’s preset rules. I’d need to learn how to shoot in manual mode.

Of course, performing poorly holding a camera has few consequences, especially when compared a novice driver navigating aggressive peers. Nevertheless, I take it seriously: I’ve now spent many years trying to understand the relationship between camera and shooter, and how many individual factors need to line up to produce a great photo.

In South Africa, I introduced a new challenge to the foundation I’d already built: manual focus. A few weeks earlier, I’d bought a new camera, an Olympus OM-D EM-1 Mark II, based on the popular Micro 4/3 platform. It’s a beautiful piece of engineering, compact and substantial at the same time, with a variety of lenses that, as of writing, I’ve yet to explore. But I knew that I wanted to use this versatile camera to capture the elephants, lions, rhinos, giraffes, and whatever else I saw out there, so I needed to improvise. I inherited a 70-210mm telephoto lens from my father’s old Pentax camera, which on a Micro 4/3 sensor would be doubled to 140-420mm, a focal length perfect for gleaning the details of a sedentary killer a quarter mile away. And while lens adapters are cheap and capable, they break autofocus, a feature I will never again take for granted. I would spend my bumpy morning and afternoon rides making minor focus adjustments to ensure that a rhino’s horn would be perfectly in focus, else the pictures would be unusable.

A few of the photos the author captured. Copyright Daniel Bader.

Thanks to a number of built-in camera features like focus peaking, manually centering on my unwitting subjects was relatively easy, but it still took me a few hours to get the hang of it. By the third ride out, I no longer had to think about my actions: my brain and hand were in perfect, balletic unison. I didn’t realize it until later, but there were enormous differences in quality — focus accuracy, yes, but also framing — between the first hundred and last hundred photos I took over my three days there. It was hard and frustrating and satisfying and exhilarating, and that’s exactly the point. It was manual.

I’m not sure I would do the same thing again, though: how important is the process in relation to the finished product? If a tailor-made autofocus lens produces better photos, would I love them less because I exerted less effort to achieve them? Would I actually enjoy driving more if I was more engaged in the mechanics of the vehicle itself? I’m not sure, but I can definitely say this: there’s nothing like an elephant deciding that it doesn’t like you and forcing your driver to reverse down a dirt road in the kind of all-enveloping darkness you can’t even imagine until you’re in the middle of South Africa with an elephant chasing you in the middle of the night.

Happy to be back after a few weeks away. Mobile World Congress, slow as it was this year, was a great way for the team to get together and catch up in person. We only get to do that a few times a year and I really enjoy it.

Next one is Google I/O, which is coming up in just about seven weeks. Given that Google just dropped Android P, renamed its smartwatch operating system, and is doubling down on Assistant, it’s a good time to be in the ecosystem.

Have a great week, and we’ll talk again soon.

-Daniel

US Navy launches submarine with gamepad-guided periscope

The Navy’s fourth USS Colorado attack submarine has recently gone into service with an Xbox controller onboard. No, not so sailors can play Overwatch: they’ll actually be using the gaming device to steer the vehicle’s two photonics masts, which you can think of as high-tech replacements for typical periscopes. The masts don’t require periscope tubes to work and rely on high-res cameras to capture images to display on a big screen instead. When the military first announced that it’s using an Xbox controller on the Colorado, it said the device was replacing the joystick and control panel Lockheed Martin originally designed for the sensors.

The original controls would’ve cost the Navy around $38,000, which is a ton of money to spend on a system that sailors found clunky and difficult to use. So, Lockheed Martin subbed them with controllers during the trial phase and found that operators were able to figure out how to maneuver the high-tech periscopes using the devices within just a few minutes. The Navy now doesn’t have to spend extra for training — and controllers only cost $30 a pop.

Now that the Colorado is an official naval asset, the US Navy will be using the 377-foot-long sub to conduct surveillance and to fight off enemy submarines and surface ships. It’s the only attack submarine that uses an Xbox controller right now, but it won’t be the last: the Navy plans to equip all modernized Virginia-class subs with one in the future.

Via: CNET

Source: AP

Facebook may have broken FTC deal in Cambridge Analytica incident

Facebook may face more legal trouble than you might think in the wake of Cambridge Analytica’s large-scale data harvesting. Former US officials David Vladeck and Jessica Rich have told the Washington Post that Facebook’s data sharing may violate the FTC consent decree requiring that it both ask for permission before sharing data and report any authorized access. The “Thisisyourdigitallife” app at the heart of the affair asked for permission from those who directly used it, but not the millions of Facebook friends whose data was taken in the process.

Facebook, for its part, said that it “reject[s] any suggestion” that it violated the consent decree. It maintained that it “respected” users’ privacy settings.

If the FTC did find violations, Facebook could be on the hook for some very hefty fines — albeit fines that aren’t likely to be as hefty as possible. The decree asks for fines as large as $40,000 per person, but that would amount to roughly $2 trillion. Regulators like the FTC historically push for fines they know companies can pay, which would suggest fines that are ‘just’ in the billion-dollar range. Given that there are already multiple American and European investigations underway, any financial penalty would be just one piece of a larger puzzle.

The possibility of FTC action comes right as there are complaints about Facebook’s response to Christopher Wylie, the whistleblower who blew open the data sharing scandal. His attorney, Tamsin Allen, has stated that Facebook took a two-faced approach to Wylie’s revelations. It “privately welcomed” Wylie’s help, Allen said, but publicly suspended his account and criticized him. That was indicative of a company focused more on “damage limitation” than sincerely addressing the problem at hand, according to the attorney. We’ve asked Facebook for its response, but the accusations certainly don’t help its case.

Cambridge Analytica has tried to distance itself from the incident, claiming that Wylie was a contractor rather than a founder and that it was a partner, Global Science Research, that had harvested users’ data. The company said it purged the data when it had learned that GSR sold data to outside parties.

Source: Washington Post

This $78 AmazonBasics wall mount allows you to move your monitor where you want

Put your monitor in the perfect position.

This AmazonBasics wall mount monitor stand is down to $77.79 on Amazon. That price is a discount from its $100 street price, and it is only one of two discounts we’ve ever seen for this mount.

If you work in a semi-permanent office space and don’t mind attaching this to the wall behind your desk, you could really free up a lot of real estate for yourself. Just make sure your monitors have standard VESA mounts on the back (and they most likely will). The arm extends and contracts, tilts for different reading angles, and rotates from landscape to portrait mode. Mounting your monitor to the wall creates desktop space, and it’s easy to set up.

The mount has a one-year warranty from AmazonBasics. More than 1,000 users give it 4.4 stars on Amazon.

See on Amazon

Should you buy physical or digital PlayStation 4 games?

Can’t decide on physical or digital? Let us help!

Digital or physical? It’s an age-old question that only started being asked just recently. Once all of our consoles were constantly connected to the internet, we entered a world where it was no longer necessary to trudge out to your local game store to acquire the newest game. You can now sit in the comfort of your own home and the games come to you. If you have a PlayStation 4 and you’re having trouble deciding what format to buy games in, read on and we will go over the benefits of each format in order to help you choose

All in on Digital

Saving space- If you are a gamer with an unending thirst for new games but a finite amount of space, then digital may be the way to go. You can build a massive library of games which only consumes space on your hard drive but none in meatspace.

Get games sooner- If you want to start playing a game the very second that release day starts, then you probably want to go digital. Often, with digital releases you can pre-install the game and the moment midnight strikes, you can start playing. Your friends that play physical games will have to wait until the store opens in the morning. And even if there is a midnight release at a local retailer, physical gamers will almost always have to download some updates before they get started.

Savings– If you’re looking to save some bucks, you may want to look to the PSN Store. In what seems to be an obvious attempt to compete with Steam, PSN has offered some pretty incredible sales and discounts in the last few years. Brick and mortar retailers are often unable to offer such deep discounts. If savings is job one, then digital may be your solution.

Only Physical for me!

Taking up space– Some of us absolutely love seeing all of our games stacked up in neat little rows. This is an itch that a digital library simply cannot scratch. If you like having a visible library of games to look at and show off to your friends, then physical games are definitely going to be the choice for you.

Resale value- One thing that digital games simply cannot offer is the ability to resell your games. If you’re the sort of person that finishes a game and never picks it up again, then it might make sense to take it back to your brick and mortar in order to make a dent in the cost of your next purchase. In addition, loaning a digital game to a friend is pretty much a non-starter.

Buy local- another upside to buying physical games is that it offers you the opportunity to support local gaming shops in your area. If the ability to go into a store and browse games is a thing that’s important to you, then it’s important to remember to spend some money there. If you want to ensure that game shops don’t go the way of the video store then this is something to keep in mind.

Ultimately, the choice between digital and physical formats is a matter of preference. Figure out what is most important to you and your game library and make your descion based on those needs. There is no right or wrong answer, just the one that fits your lifestyle best.

How do you buy your games?

Do you prefer digital or physical video games? Let us know your reasoning below!

Why are we talking about PlayStation 4 on Android Central? Let us explain.

PlayStation 4

• PS4 vs. PS4 Slim vs. PS4 Pro: Which should you buy?
• PlayStation VR Review
• Playing PS4 games through your phone is awesome

Amazon

Coca-Cola and US government use blockchain to curb forced labor

The quest to end forced labor has created some unusual technological allies. Coca-Cola, the US State Department and a trio of crypto organizations (Bitfury Group, Blockchain Trust Accelerator and Emercoin) have launched a pilot project that will use blockchain to enforce worker rights. The initiative would use blockchain’s distributed ledger technology to create a secure, decentralized registry for workers and their contracts. They’d not only have the sort of identification that isn’t always guaranteed, but a trail of evidence in case employers abuse their power or don’t honor their end of a bargain.

Coca-Cola is playing a major role as part of a pledge to conduct 28 national studies on labor and land rights for its sugar supply chains before 2020. Ideally, this tackles complaints that it and similar companies fail to protect workers’ rights at every step. The State Department will offer its experience with labor protection, while Bitfury Group and Emercoin are producing the blockchain platform itself. Blockchain Trust Accelerator is a non-profit aiming to use its namesake tech for social good.

The pilot already has its limits. Blockchain can persuade companies and governments to respect work contracts, but it can’t make them respect those contracts. Also, blockchain’s digital nature raises some implementation questions: how do you ensure that workers can access their info when many of those affected might not even have a smartphone? The project is still young, however, and this could still represent an improvement over a modern employment system that frequently lets companies abuse workers with relatively little consequence.

Source: Reuters

Twitter may be the next to ban cryptocurrency ads

Twitter may soon join Facebook and Google in cracking down on ads for cryptocurrency-related products. Sky sources have claimed the social network will institute worldwide ban against ads for initial coin offerings, cryptocurrency wallets and token sales within the next two weeks. It might also ban ads for cryptocurrency exchanges with “some limited exceptions,” according to the apparent leak.

The company told Engadget it had no comment at the moment.

While the tipsters didn’t provide Twitter’s exact reasoning, it’s likely to be the same as for the site’s peers: it doesn’t want to knowingly put users at risk. Many ICOs and token sales have uncertain prospects, and in the worst cases are take-the-money-and-run scams. Meld that with the threat of hackers and there’s a real chance investors will lose money, with little recourse if things go sour. More regulations are likely coming, but that’s not much comfort to Twitter, Google and others who face pressure to protect their users while the crypto market remains a wild frontier.

Source: Sky