EDWARDSVILLE — Area law enforcement officials are seeing an increase in the report of Bitcoin crimes.
“With the addition of Bitcoin ATM machines in the area, we are starting to see people get scammed,” said Edwardsville Dep. Police Chief, Michael Lybarger. “The problem is going to get worse.”
Bitcoin is a decentralized digital currency, or cryptocurrency, that can be transferred on the peer-to-peer Bitcoin network. Bitcoin transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain.
There currently are several Bitcoin ATM machines in the Riverbend.
“The Bitcoin ATM makes it easy for anyone, even people with no knowledge of Bitcoin, to acquire it,” Lybarger said.
“If someone calls or emails you, do not go to a Bitcoin ATM machine and get Bitcoin to send them,” he said. “This is just a new twist on an old scam. It is easier to send Bitcoin than cash [gift] cards and there is less risk for the criminal.”
Bitcoin ATMs are kiosks that allow a person to buy Bitcoin using an automatic teller machine. Some Bitcoin ATMs offer bi-directional functionality, enabling both the purchase of Bitcoin as well as the sale of Bitcoin for cash. Bitcoin machines are not the same as traditional ATMs, but work in a similar fashion.
According to Norton.com, people should be on the look out for red flags that may indicate a cryptocurrency scam. Examples include if an offer seems too good to be true, a website’s address bar does not begin with “HTTPS,” the payment request is urgent, the payment is requested in cryptocurrency, or your account logins are requested.
According to the Federal Trade Commission, 14% of all reported losses to imposter scams are in cryptocurrency. Cryptocurrency scams have risen 516% from 2020 to 2021, and investors in the 20-30 age bracket are the most susceptible to being scammed.
There are ways to avoid cryptocurrency scams. Consumers can research before investing any money into cryptocurrencies. Those who believe they may have been targeted by a cryptocurrency scam should report it to the Federal Trade Commission, Securities and Exchange Commission (SEC) or Commodities Futures Trading Commission.
Unfortunately, there are few avenues to potentially recover scammed cryptocurrency.
Bitcoin use began in 2009 when its implementation was released as open-source software. A few governments officially use Bitcoin in some capacity: El Salvador and the Central African Republic have adopted Bitcoin as legal tender, while Ukraine accepts Bitcoin donations to fund its resistance against Russia’s invasion this year.
Just as dollars are divided into smaller units, Bitcoin is, too. However, cryptocurrency constantly changes its market value, unlike dollars. One bitcoin is divisible to eight decimal places. Units for smaller amounts of Bitcoin are the millibitcoin (mBTC), equal to 1⁄1000 bitcoin, and the satoshi (sat), which is the smallest possible division, and named in homage to bitcoin’s creator, representing 1⁄100000000 (one hundred millionth) bitcoin. 100,000 satoshis are one mBTC.