The worst Bitcoin scams from 2011 to 2018

Bitcoin scams and thefts, short sad story. 

Many hope to read them only and never be protagonists, but Bitcoin scams are sadly on the agenda. Here are the worst ever.

You don't always have to deal with a "simple" hacker: it may happen that a criminal organization is hiding behind a Bitcoin scam, using social engineering instead of malware, has managed to create the perfect trap for fans - and investors - of cryptocurrencies.

So here is a quick historical excursus on the worst Bitcoin scams between 2011 and 2018 that could be very useful.

Given the historical period and given the rapidly growing Bitcoin valuation, it may happen that some hacker or serial scammer puts old schemes that have worked in the past back on their feet. Knowing what happened no later than a few years ago, therefore, could be the best solution to avoid falling into the trap of scammers again.

June 2011 - Hackers steal half a million dollars from an unsuspecting user

In the first few months of 2011 we witness the first Bitcoin boom. From a payment instrument known to a few close friends, Satoshi Nakamoto's cryptocurrency had rapidly expanded its circle of users, to "land" in conversations and online posts of generalist forums. In those years, mining Bitcoin was much simpler and more profitable and in a few months it was possible to accumulate a fair amount of digital currency with a simple home computer.

This is what happened, for example, to Allinvain, a US user of the Bitcoin Talk forum, able to create 25 thousand Bitcoins in a short time and suddenly found himself a millionaire (or almost) as soon as the Bitcoin evaluation began to grow. Enthusiastic, Allinvain brings forum users to the unexpected economic success. He could not make a worse mistake: a few days later he discovers that someone had entered his computer and had taken advantage of it to empty the Bitcoin wallet.

August 2011 - MyBitcoins online wallet service disappears from the web

As is known, in order to store Bitcoins after having created or purchased them on an exchange, it is necessary to have a wallet (or wallet). The wallets can be either physical (of cryptographic USB sticks) or software operating both locally (to be installed on a PC) and on the web (real platforms where, often and willingly, it is possible to buy and sell Bitcoin). In most cases, online wallets are managed by reputable companies, but it may also happen that you are not so lucky. For example, ask users who had entrusted their digital savings to the MyBitcoins online wallet, which suddenly disappeared from the web in August 2011 claiming to have been hacked. Needless to say, with the wallet and the managers all the Bitcoins that the users had entrusted to him also disappeared.

March 2012 - Attack on web servers

It may also happen that online wallets are actually victims of a hacker attack facilitated by poorly protected hardware and web infrastructure. This is what happened to users of the Bitcoin exchange, victims of the theft of about 50 thousand Bitcoins. The hackers, in this case, stormed the hosting servers on which it was hosted and took possession of all the digital capital stored within the wallets, bringing home several hundreds of thousands of dollars. A similar case concerned, a few months later, also the Bitfloor exchange, forced to close its doors after the theft of about 25 thousand Bitcoins.

August 2012 - The Ponzi scheme

In the summer of 2012, the FBi began investigating the activities of Bitcoin Saving and Trust and its creator Tendon Shaver. The company was demanding huge investments in Bitcoin, promising a 7% weekly gain. Investigators do not take long to understand that it is the most classic of the Ponzi Scheme: the deposits of new users were used to repay the interests of the old and in the meantime Shaver continued to accumulate cryptocurrency. Bitcoin S&T was closed in August 2012, when it had been able to accumulate 700 thousand Bitcoins.

 February 2014 - Attack on Mt. Gox

The attacks on Bitcoinica and Bitfloor brought hackers just under 80 thousand Bitcoins: a huge amount, but nothing compared to the theft that occurred against Mt. Gox, the largest Bitcoin exchange active in 2014. Managed by a French computer scientist who emigrated to Japan Mt Gox processed transactions for hundreds of thousands of dollars, if not millions, every day. At the time of the hacker attack, 700 thousand Bitcoins were present in the wallets managed by the Franco-Japanese exchange, for a value of about 450 million dollars.

August 2016 - Theft in Bitfinex

In August 2016, however, the Bitfinex exchange was the subject of "special" attention by hackers. The theft, in this case, brought in the hackers' pockets a value of 77 million dollars, while the users had to settle for a compensation reduced by 36%.    

2018 - $10 million stealed from Microsoft

 Former Microsoft software engineer convicted of 18 federal felonies for stealing more than $10 million in digital value such as gift cards.  Volodymyr Kvashuk, a 25-year-old software developer and Ukrainian citizen who worked for Microsoft from 2016 to 2018, took advantage of a testing program for Microsoft’s online retail sales platform. He made test accounts to obtain “currency stored value” such as Microsoft gift cards and then resold them online.