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Home Insights How to Report Bitcoin Scammers and Why You Should

How to Report Bitcoin Scammers and Why You Should

by Brett M. Christensen

Criminals often use cryptocurrency Bitcoin to receive payments from victims. How do you report Bitcoin scammers and does reporting do any good?

Ransomware usually demands payment in Bitcoin, as do fake blackmail sextortion scams.

Typically, scammers instruct you to buy Bitcoin and then send it to a specified Bitcoin address.  A Bitcoin address is a unique string of letters and numbers that correspond to a Bitcoin payment source or destination.

Here’s one such demand from a scam email in which the sender has falsely claimed that they have recorded a compromising video of you on an adult website. They warn that they will send the video to your contacts if you don’t pay up.

If you want to prevent this, transfer the amount of $735 to my bitcoin address (if you do not know how to do this, write in Google: “Buy Bitcoin”). My bitcoin address (BTC Wallet) is: 1K1KMHpynJHQRbhzKHyik6yaJuQYxSaZCm

While Bitcoin is not completely anonymous, Bitcoin transactions offer users greater anonymity than credit cards and other types of traditional financial transactions. Information on notes:

All Bitcoin transactions are stored publicly and permanently on the network, which means anyone can see the balance and transactions of any Bitcoin address. However, the identity of the user behind an address remains unknown until information is revealed during a purchase or in other circumstances.

This makes curtailing Bitcoin scammers challenging, especially since canny criminals will take steps to protect their privacy, such as changing Bitcoin addresses and laundering the stolen funds.

So, is it Worth Reporting Bitcoin Addresses?

Unfortunately, reporting a Bitcoin address won’t immediately identify a criminal or stop their activities.  Bitcoin Abuse Database notes in its FAQ:

What are you doing to shutdown the bitcoin address I report?

There is nothing we can do. No bank or government has the technical ability to freeze an account to seize funds on the blockchain. That is why criminals use bitcoin.

Our goal is to publicly documenting (sic) that certain addresses have been used in a crime. We hope that in the future it will be harder for the attacker to spend stolen bitcoin. At the very least, attackers will have to spend more on laundering the money.

But, by reporting a Bitcoin address used in a scam, you are providing a permanent and publicly accessible record of the scam attempt. For example, if you enter the Bitcoin address used in the sextortion scam above into the Bitcoin Abuse Database, you will see a report with details about the scam.

In fact, doing a Google search for the Bitcoin address reveals several reports indicating that the address has been used in scams.  So, reporting addresses may help others from becoming victims.

Also, as the Bitcoin Abuse Database website points out, even hackers make mistakes. In some cases, such mistakes could reveal the real identities of people who steal Bitcoin. And the algorithms used to trace Bitcoin transactions may become more sophisticated over time, which could ultimately help identify criminals.

So, despite its limitations, reporting Bitcoin scams is still a valid way of fighting back against online criminal activity.

How to Report Bitcoin Scams

You can report Bitcoin scams via the report form on the Bitcoin Abuse website.

Alternatively, you can use the report form on the Bitcoin WhosWho website.

Umm, What is ‘Bitcoin’ anyway?

If you are unfamiliar with Bitcoin and how it works, this short video from the BBC explains the concept:

Or, for a more in-depth explanation, refer to the What is Bitcoin article on the Investopedia website.

Top Image by Ricardo Goncalves from Pixabay

Importance Notice

After considerable thought and with an ache in my heart, I have decided that the time has come to close down the Hoax-Slayer website.

These days, the site does not generate enough revenue to cover expenses, and I do not have the financial resources to sustain it going forward.

Moreover, I now work long hours in a full-time and physically taxing job, so maintaining and managing the website and publishing new material has become difficult for me.

And finally, after 18 years of writing about scams and hoaxes, I feel that it is time for me to take my fingers off the keyboard and focus on other projects and pastimes.

When I first started Hoax-Slayer, I never dreamed that I would still be working on the project all these years later or that it would become such an important part of my life. It's been a fantastic and engaging experience and one that I will always treasure.

I hope that my work over the years has helped to make the Internet a little safer and thwarted the activities of at least a few scammers and malicious pranksters.

A Big Thank You

I would also like to thank all of those wonderful people who have supported the project by sharing information from the site, contributing examples of scams and hoaxes, offering suggestions, donating funds, or helping behind the scenes.

I would especially like to thank David White for his tireless contribution to the Hoax-Slayer Facebook Page over many years. David's support has been invaluable, and I can not thank him enough.

Closing Date

Hoax-Slayer will still be around for a few weeks while I wind things down. The site will go offline on May 31, 2021. While I will not be publishing any new posts, you can still access existing material on the site until the date of closure.

Thank you, one and all!

Brett Christensen,