Bitcoin Is Not A Get-Rich-Quick Scheme:  How To Spot And Avoid Scams

When something becomes very popular, scammers are not far behind. When the internet was new, email scammers were victimizing people on a daily basis. Today’s version of this is happening in the Bitcoin and Cryptocurrency industry.

Since Bitcoin gained so much value in 2017, going from less than $900 per BTC in January to $5,700 today, the proliferation of get-rich-quick ponzi scams got much worse as well. The technology is so new that few people understand it, it has become easy to convince people to give up their hard earned money for the promise of impossibly massive earnings in a short time.

Bitcoin is a digital currency and a technological platform upon which financial services are built - it is NOT a get-rich-quick scheme.

 How to spot a Bitcoin Ponzi scheme

 Are you told that you have to have a “minimum” investment? Do they promise “guaranteed” returns of up to several percent per month? Do they show you pictures of lamborghinis and houses they bought from “mining” bitcoins?

If you answered yes to any of these questions, run the other way. That’s a ponzi scheme.

This tried and tested idea relies upon high yield investment programs and multi-level marketing. In this grey area schemes, a low initial investment can be multiplied by signing up additional members using referral links. Before long, hundreds of victims have joined the scheme. At a later point in time, the original scammer walks away and the pyramid collapses.

 Other tips to protect yourself and others

 1. Don’t trust anyone claiming they will give you or help you mine bitcoin, and avoid social media invites to join these money-making ventures. There is no such thing as guaranteed returns on cryptocurrencies. 

2. If it is too-good-to-be-true, it probably is a scam.

3. When dealing with seemingly legitimate companies online, check if they are real registered companies. Better yet, ask to see their office or meet them in person. Be vigilant when engaging with the social media accounts of legitimate bitcoin brokers or trading platforms, as they are frequently victims of convincing impersonations as well.

 4. Never engage in any financial transaction, bitcoin or otherwise, via direct message on social networks. These scammers use social media to reach tens of thousands of people and eventually will find someone to victimize. 

5. When in doubt, call the BSP Consumer protection hotline. The BSP now regulates Bitcoin companies and they will be able to tell you if you are dealing with a licensed or at least legitimate company.

• Consumer Assistance
  
• Direct Line: 708-7087
  
• Facsimile: 708-7088
  
• Email Address: consumeraffairs@bsp.gov.ph
  

 At the end of the day, greed is what these scammers rely on to succeed. Make sure you are informed about the investments you will make with your hard earned money.

SCI Leading The Public Education Effort for Cryptocurrency and Blockchain Tech in the Philippines

The blockchain and cryptocurrency industry has been quite busy this year, with Bitcoin reaching new heights by growing over 400% and the entire global cryptocurrency space keeping pace with it, growing to match the market cap of Bitcoin at almost $150 Billion combined today. As usual, more people are keen to learn about the technology, and SCI is leading the charge on this front with several media and speaking appearances just in the past months.

Here are some of the recent activities of SCI, as well as some announcements on future talks and conference appearances where you can catch up with us if you wish to do so!

Asia Tech Summit 2017 - The Asia Tech Summit featured a “What is Bitcoin and Blockchain” talk with SCI co-founder Miguel Cuneta presenting in the conference. 

DLSU tech summit 2017 - SCI was back in DLSU to talk about Bitcoin and blockchain tech to future computer science professionals and entrepreneurs.

ANC on the money - SCI Co-founder Miguel Cuneta alongside BSP representative Melchor Plabasan on ANC’s TV Show “On The Money”, talking about cryptocurrency regulations in the Philippines, episode airing date to be announced.

DZRH news TV - The oldest radio station in the country at 78 years of broadcasting, DZRH News TV brings on Miguel Cuneta to talk about Bitcoin and Blockchain technology on their show.

Sustainability Summit 2017 - SCI participates in the Sustainability Summit 2017 to talk about how technology plays a key role today and will play an even bigger role in the future of sustainable development in the country.

The Asian Banker: Future of Finance 2017 - A premier banking conference attended by top banking officials in the region as well as the BSP’s top officials will feature several talks about blockchain technology and how it will play a big role in the future of the financial service industry, with SCI co-founder Miguel Cuneta participating as a panel speaker.

Seamless Philippines 2017 - SCI co-founder Miguel Cuneta and Chief of Compliance Rafael Padilla will be on a panel to talk about the future of payments and the role of blockchain technology in the financial service industry.

Public Service Announcement: What Will Happen to the Bitcoin Network on Aug. 1st, 2017?

The Bitcoin network is run by thousands of volunteer nodes and miners running the Bitcoin software to process transactions. The Bitcoin Blockchain maintains its integrity by making sure all the nodes are in agreement as to what is the most updated and accurate record of transactions in the network. 

On Aug. 1st, 2017, some bitcoin nodes will try to force the miners to implement a protocol upgrade proposal called BIP148. They will attempt to do this because they believe that the recent explosive growth of Bitcoin has made the network slow and more expensive to use than before. One possibility is that if enough nodes decide to run a different version of the Bitcoin software, this might cause the chain to split, or what is called a “Hard Fork”. This will result in two versions of Bitcoin running at the same time.

Here is an illustration of the possible scenarios (from Coindesk):

Four things that could happen:

Your bitcoin balance will stay the same and you will be able to use it as usual. (likely)

You could be on the “wrong” chain and lose your Bitcoin balance. (unlikely)

You can have a balance on both chains and choose which one you want to use. (likely)

Nothing will happen, majority will adopt Segwit, and Bitcoin will continue onward (Most likely).

Most likely, this will be a non-event. As of this writing, Segwit (BIP91) has gotten locked-in and will likely be adopted, and looks like the community and industry are all after the same thing: for Bitcoin to keep improving and growing. The signs now point to an amicable and peaceful resolution to the scaling debate and we will see a burst in confidence from the market when we finally resolve this issue. Bitcoin price has rallied from $1850 to $2800 as of this writing due to this. 

As a security measure, on August 1st, 2017, we will be temporarily suspending services that require the use of the bitcoin network including sending and receiving, buying and selling, payments, and remittances. This is to protect you, our customers, from any technical difficulties that might arise from the issue being resolved by the network. Rest assured that your deposits are safe and that we will resume regular services at the soonest opportunity.

When it comes to financial services, we cannot be too careful. We strive to provide the best service and want to ensure that all your accounts are unaffected by whatever arises from the current situation. 

If you have any questions or concerns, feel free to reach out to us!

For more detailed information, check out the official Bitcoin.org website.

Bitcoins and Bubbles: What To Do When The Market is Rising (or falling!) Like Crazy

Bitcoin and cryptocurrency valuations are at an all-time high. As of this writing, the combined value of these digital assets have exceeded $100 Billion, from $25 Billion just 3 months or so ago. There is a feeling of some kind of frenzy among crypto-enthusiasts, traders, investors, and now even the general public, and the mainstream media is eating it up and compounding the craziness.

We would like to take this opportunity to tell our readers and customers to be rational in these seemingly irrational times. Assets that increase in value by 400% in 4 weeks can be quite dangerous for people who buy into the hype without actually understanding what they are getting into.

SCI has always refrained from providing investment advice because we believe that Bitcoin is more valuable as a technological platform than a speculative investment, and our business relies not on the exchange rate of bitcoins, but to the utility and reliability of the technology. 

Here are a few tips from an old post we made a couple of years ago about what to consider if you are curious about what is happening in the cryptocurrency industry today:

 1. DON’T PANIC!

Don’t panic. The “Fear of Missing Out” or FOMO is a powerful emotion. It can lead to irrational decision-making such as buying more bitcoins than you can afford. Calm down and understand that the market behaves in a very unpredictable way, and this price rise can suddenly turn into a price dump. Calm down and observe intelligently.

2. Invest only what you can afford to lose

Investing in ANYTHING is risky. It is easy to get caught up in the fact that the price is going up everyday so you can make some easy profit buying and selling. Bitcoin is much more than a speculative investment. It is an amazing technology that has great benefit to society as a whole. Go ahead and do trading, but make sure you are not breaking your piggybank or auctioning off your beloved dog just to buy more bitcoins

 If you do decide, make sure you buy and sell bitcoins with the most trusted services like Buybitcoin.ph

3. Don’t believe anyone who tells you they can predict the price

Nobody can predict the future. Traders use past data to analyze the future, but it is impossible. The price is going up possibly because more people are buying bitcoin. Truth is, yes, there are many reasons as to why this happens so we can’t always listen to the first person who says they know what will happen with the bitcoin price. Again, keep calm and always rethink your decisions.

4.  Beware of Scammers!

Scammers will come out of the woodwork when the price is going up just because they want your bitcoins. They will use the excitement of people to confuse everyone and try to make them commit mistakes when buying or selling bitcoins. Check out our Halloween post on how to defeat those annoying Bitcoin “Monsters”.

5. Do Your Own Research and LEARN

For bitcoin supporters and users, the price going up signifies that the industry is healthy and growing. This is a great time for new people to learn more about bitcoin and the amazing applications coming out for everybody’s benefit. Buy some bitcoins and SAVE it, put it in a wallet and don’t touch it, so you can just watch the price go up and down without any stress :)

Bitcoin is more than just a way to make quick profits. It is a revolutionary technology that will change the way we do finance and commerce online. The price of bitcoin will keep rising, and will also keep falling. What is important is that we understand how to take advantage of the technology without risking anything. If you are part of this community, you are already lucky, witnessing the emergence of a technology that we will all use to our benefit in the future.

What is Bitcoin and Blockchain Technology? This Comprehensive Resource List Has All The Answers For You.

What is bitcoin and the blockchain?

A comprehensive list of articles, blog posts, videos, books and courses to help get you started.

Bitcoin, Ethereum and other cryptocurrencies have recently been making a mainstream media frenzy because their prices are skyrocketing. Naturally, more and more people become interested and want to learn more, but have a hard time finding a good resource of easy-to-digest information about this technology. 

Look no further. This list, put together by MIT Media Labs Digital Currency Initiative, is list of starter articles, blog posts, books and even entire university courses.

Please Feel free to share this list with others too. From beginner to advanced, everyone could learn something from the resources provided here.

Here you go!

Overviews (30–45 mins)

Here are several of the best short articles about Bitcoin by some of the brightest minds in the technology space, Including Marc Andreessen (Creator of Mosaic, the first modern web browser), Reid Hoffman (Founder of LinkedIn). 

Why Bitcoin Matters by Marc Andreessen

Why the Blockchain Matters by Reid Hoffman

How Does Bitcoin Work? (video) by David Andolfatto

Programmable Blockchains in Context: Ethereum’s Future by Vinay Gupta

The Blockchain Application Stack by Joel Monegro

The Shared Data Layer on The Blockchain Application Stack by Joel Monegro

How Bitcoin Is Like SMTP by Joel Monegro

How The Blockchain Can Unshackle Us by Jalak Jobanputra

The Non-Expert’s Guide to the Mt. Gox Fiasco by Arianna Simpson

Applications (60–90 mins)

These are more specific articles about the benefits of Bitcoin tech, as well as practical applications for the technology in many different industries in today’s world. 

Some ideas for native bitcoin apps by Chris Dixon

Certificates, Reputation and the Blockchain by Philipp Schmidt

Bitcoin Fact. Fiction. Future. by Tiffany Wan & Max Hoblitzell

State-Sponsored Cryptocurrency: Adapting the best of Bitcoin’s Innovation to the Payments Ecosystem by Deloitte

Elizabeth Rossiello Describes How BitPesa Slashes International Payment Fees by Laura Shin

Bitcoin Overview & Applications (video) by Brian Forde

How the blockchain will enable self-service government by Brian Forde &Michael Casey

Can Bitcoin Be Used For Good? by Chelsea Barabas & Ethan Zuckerman

Want to rent Star Wars? May the force be with you… by Brian Forde

Technical Overviews (2–4 hours)

The Original Bitcoin Whitepaper is here on this list. Only 8 pages long, this explains Bitcoin from the words of the creator of Bitcoin himself. Other links provide a more in-depth view of the technology and its applications. 

Bitcoin: A Peer-to-Peer Electronic Cash System by Satoshi Nakamoto

Bitcoin: The new gold rush? by Val Srinivas

Bitcoin And Blockchain: Two Revolutions For The Price Of One? by Richard Gendal Brown

How the Bitcoin protocol actually works by Michael Nielsen

Network Security and Proof of Work: Do We Need an Alternative? by Arianna Simpson

Research Perspectives and Challenges for Bitcoin and Cryptocurrenciesby Joseph Bonneau, Andrew Miller, Jeremy Clark, Arvind Narayanan,Joshua A. Kroll, Edward W. Felten

Books (1–2 days each)

For the bookworms out there, these books are considered the best in the industry. Some are technical, and others are more focused on the history and personalities in the industry. 

Mastering Bitcoin by Andreas M. Antonopoulos

The Age of CryptoCurrency by Michael Casey, Paul Vigna

Blockchain Revolution by Don and Alex Tapscott

Digital Gold by Nathaniel Popper

Bitcoin Course & Textbook (4–5 weeks)

Full textbooks and even a full course on Cryptocurrency from Princeton University. 

Bitcoin and Cryptocurrency Technologies (course) at Princeton University

Bitcoin and Cryptocurrency Technologies (textbook), by Arvind Narayanan, Joseph Bonneau, Edward W. Felten, Andrew Miller, Steven Goldfeder



SOURCE: MIT Media Labs Digital Currency Initiative

The Real Reason Bitcoin Is Skyrocketing

The price of Bitcoin just just rocketed past $2000, yet the truth is, the price of one bitcoin is the least interesting thing about it.

Most people are amazed that the price of Bitcoin has gone from $200 to $2200 in just 24 months. No asset class in the world has performed better, and it seems that there is nothing stopping this bull run from reaching even greater heights. Stories of people finding bitcoin in their computers that are now worth millions of dollars are going to start popping up in the news once again, and the media cannot get enough of it. And of course, it makes sense for this to be over hyped because 1000% growth in 24 months is not “normal”. 

The thing is, people also want to know WHY bitcoin’s value keeps rising. Why is it worth $2200 for one bitcoin today? What gives it this valuation?

Whatever explanations you hear from so-called experts, don’t believe them. There is only one reason for the price of Bitcoin, or the price of anything else for that matter, to go up or down.

The Law of Supply and Demand

The law of supply and demand. Free market forces dictate that when there is more demand than there is supply, prices will rise. That’s it. There is nothing too complicated about it. The reason why Bitcoin’s price keeps rising is that there are more people buying bitcoins than there are people selling bitcoins, and because Bitcoin is capped at 21 million units.

This brings us to the real question we should be asking: Why are more people buying bitcoin today?

Utility + Scarcity = Value

Japan, one of the most advanced countries in terms of technology and also one of the biggest economies in the world, just made Bitcoin a legal payment method nationwide. Suddenly, Bitcoin became useful in Japan for merchants and consumers alike. This drove the demand for Bitcoin up, and since it is a very scarce asset, it naturally also drove the price up. It actually increased by over 100% since then. They are the first country to do this, with the Philippines following suit with circular no.944 of the BSP taking effect just a few months ago. Expect more countries to follow too.

A Hedge Against Financial Crises

Bitcoin, as mentioned by CNBC, has become a safe haven asset for investors, much like gold or other commodities that go against the flow of capital. Simply put, when the economies of the world are tanking, Bitcoin price tends to go up. Savvy investors are starting to learn that taking a small percentage of your savings or investments and placing them into Bitcoin will offset most losses and actually give much bigger gains, as proven historically. This means that more people want to buy Bitcoin, which translates to a higher price.

Speculation

The world of Finance is like one big casino. A lot of people get into forex currencies or the stock market for one reason alone - to make money. There are a lot of risks if you do not know what you are doing, and you could easily go broke. Bitcoin, being a very volatile asset class where the price fluctuates up and down, is seen by a lot of traders as a risky but exciting way to earn money. Historically, anyone who has ever bought Bitcoins at any given time in the last 8 years has made money. Since people want to trade Bitcoins daily, it only means that… more people are buying it on a daily basis. 

Bitcoin Has Become A Global Reserve Cryptocurrency

Altcoins, or other cryptocurrencies, are also on the rise. There is a gold rush across the whole industry, and Bitcoin is the way to get in. Most Altcoins cannot be directly traded into regular currencies and need Bitcoin to be able to buy in or cash out. So all these people that want to trade cryptocurrencies are buying Bitcoins to fund their trading. This drives the demand for Bitcoin up and up and up, hence the price follows.

Here’s a fun fact: People who bought $100 worth of Bitcoin in 2010 and kept it all these years will be sitting on $72.9 Million today.

So, what is the real value of one Bitcoin? This can only be determined by the free market, and no one else. What gives it value? It’s utility and scarcity, or demand for its different use-cases outpacing its global supply. 

The truth is, the price of Bitcoin is actually the least interesting thing about it. There is an underlying technology behind Bitcoin called The Blockchain that has captured the imagination of thousands of the smartest and most entrepreneurial minds in the world. It has created a multi-billion dollar industry that is now working together in building applications and services that will bring the benefits of Bitcoin and Blockchain technology into mainstream acceptance.