Fraudsters are taking advantage of the irreversible nature of cryptocurrency transactions, says My Chargeback's vice president of global operations, Michael Cohen. When Bitcoin (BTC) was first conceptualized, one of its advantages was the fact that it was providing better credit card protection for individual traders.
in one of the earliest emails - from November 10, 2008 - Satoshi Nakamoto addressed a complaint from an early adopter, James A. Donald, who lamented the fact Bitcoin transactions are not immediately final.
He said: The inability to instantaneous denial is not an advantage, but it is still much faster than current systems, as paper checks can bounce after a week or two. Credit card transactions can be objected up to 60 to 180 days after that. But Bitcoin transactions can be irreversible within an hour or two.
and according to Cohen, in some cases, credit card payments can be refunded 18 months after the date of the transaction. There are two classifications of credit card refunds: unauthorized use (when the offender gains access to his credit card) and authorized (where the cardholder has authorized the transaction but is not satisfied with the outcome).
Cohen also said that when it comes to cryptocurrencies, consumers may have an opportunity to get a refund only in the case of unauthorized transactions, where credit companies such as MasterCard are excluded. And Visa certain industries such as cryptocurrency and second-class gambling.
Cohen has argued that the ubiquity of cryptocurrency scammers are hindering mass adoption: unfortunately it's a very good tool for a scammer to have a way to raise money. I think this contributes to a lack of interest in those looking to promote the general and inclusive use of digital currencies. And I think at this point it's a bit of a stumbling block because of all the people who are being duped. I mean, they're not going to be the ones promoting the use.
and continued: One of the most common ways for fraudsters is to offer some products or services (the most popular ones that tend to be related to foreign exchange trading) to an unsuspecting customer. Then, at the last minute, the fraudster convinces the unsuspecting victim to pay for the service or fund his supposed account with cryptocurrency. But according to Cohen, not all was lost for the victims; There may be potential avenues for equity.
Cohen helps victims identify fraudsters by tracking their movements on the Blockchain. This usually leads to a cryptocurrency exchange where criminals deposit the proceeds of their crimes before they are exchanged, with Cohen explaining that many ...
