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What is Bitcoin Blackmail and How to Protect Yourself

Bitcoin blackmailers attempted to steal $25000 from one of our team member’s Dad's E-trade account. So today lets Learn how they try to do it and how to protect your money. So this post today is the fpp to expain what exactly happened with her Dads account.


There are a few things that might spring my Dad out of bed on a Monday morning, but at 7:30 a.m one morning after a surprise alert from e-trade flashed across his iphone he knew he had to get up and move fast. A Bitcoin blackmailer had hacked his account and was attempting to steal $25000.

Now what is a Bitcoin blackmailer?

Well this is a title the FTC has given to the internet hackers that threaten to seize money or reveal unflattering details about our personal lives unless they receive gobs of Bitcoin and who has that. While the media tends to cover these bad actors when they demand millions in Bitcoin from major companies, like Colonial Pipeline, they're also targeting everyday consumers like my Dad.

Here's how it all played out in my father's case. Specifically the push message from E-trade said that his full investment in Apple stock had been sold. Well he hadn't requested any such sale, but when he logged into his account to learn more, his fears were confirmed. Someone had broken into his account over the weekend and placed a sell order on his Apple stock to occur on that Monday morning.

Also Read: The Worst GiftCard Scams Explained and Here’s how you can avoid them

Now when you sell a stock just for some background it usually takes a few business days to process the cash from the liquidated stock then appears in your account and at that point you can transfer it to an external bank or keep it in the account. Luckily the transaction in my Father's account was still pending and the hacker had yet to establish an account to Wire the money out.

My father immediately called E-trade and the company was able to abort the transaction. But then came some kind of strange emails. The fraudster sent multiple emails to my Dad throughout that same day alluding that he had hacked his account and he wanted more.

bitcoin email blackmail scam

Here's the email, “Sorry in advance” they said, “I have access to Amazon and some of your banks I have your routing number and bank account number. We'll just take your money the good way what if you give me $5000 payment in Bitcoin, I promise not to sell your important bank data”. The FTC says these types of messages demanding Bitcoin in exchange for not violating your life are on the rise.

Now to avoid falling prey, here are some steps to take

Rule 1: Never Reply to Unknown Mails

Never ever respond to emails or texts requesting your personal identifying information including usernames and passwords. These are called phishing scams and fraudsters send seemingly legit messages asking for personal information and they're often what lead to financial fraud. Now you may receive an email that appears to be from your Bank or the IRS asking you to click on a link and update your Password or log in to retrieve an important message related to your account. Be sure to check the sender's actual email address for the domain to verify the legitimacy and know that if the IRS or your Bank ever needs important information from you, they're not going to email you or text.

Also Read: The 5G BioshieldUSB Stick Scam Explained

In my Dad's case he did remember getting an email from Amazon asking him to update details of a recent order. He didn't recognize the order but you know what he figured my Mother must have placed it because they share an account. When he clicked on the email, he was asked to enter his username and password and unfortunately he did. For more of what happened next and how to avoid fraud keep reading.

Rule 2: Update Passwords

Update all passwords and be sure you don't use the same password for multiple accounts. My father's Amazon username and password was identical to the one he used for E-trade and that's how the hacker started to make his moves. Now my Dad uses a password manager that helps to generate and store passwords for all accounts. Some password managers that we like here at Techronicle include Lastpass and Bitwarden.

Rule 3: Two-Way Authentication

Opt for Two-way Authentication. My father believes the Bitcoin blackmailer was ultimately able to hack into his e-trade account because he had not signed up for multiple Authentications. That means that when you log in, the site will require a second or third step in some cases to authorize the login. Usually by sending the account holder, you a text message with a password that then you need to type into the site to fully gain access.

bitcoin email scam

Rule 4: Call Your Financial Institutions

If you believe your account's been hacked or if you received any cryptic emails from Bitcoin blackmailers, check in with your financial institutions. My Dad's first instinct was right, to call E-trade; that was a wise step. E-trade then immediately put a stop to the transfer, so the blackmailer was unable to sell any of my Dad's money. Later my Dad discovered the financial institution did notify local police and social services. He received calls from both agencies later in the day, the police wanted to gather more information for an investigation and the social services team was calling to ensure that my Dad wasn't too shaken up and that his financial health was okay.

Also Read: Google know more about you than you know about yourself!


So in summary, My Dad was fortunate and he acted quickly to protect his assets but you're gonna need more than luck to defend against this and other Crypto related scams. Take preventative steps like, never opening emails from institutions claiming to need personal information, update and differentiate passwords and offer to or multi-authentication wherever possible. Now what are some of your crypto related questions? Be sure to drop us a comment below and if you like these posts please subscribe to our newsletter and share this post with your friends and family as well.

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