Bitcoins are popular because they are easy to use online and with transactions around the globe. The buyers have a higher level of anonymity because the sales are not as simple to track as one done using a credit card. This appeals to many people for a variety of reasons but unfortunately, it is also appealing to scammers and identity thieves. The reduced oversight makes it easy for the dishonest to steal from unsuspecting people and makes it nearly impossible to find or recover funds.
The biggest problem with bitcoin use has been with credit card fraud. This has made it impossible for some to purchase bitcoins with credit cards because banks were unable to initiate charge-backs when a user discovered fraudulent charges on their account. Anyone familiar with bitcoins understands that once bitcoins are sent it is impossible for them to be returned. There is no clear way to definitely know who has received them and no way for credit card issuers to get back the money stolen from their clients.
The fraud happens in a couple of ways. Thieves hack into accounts and steal credit card information and then use those accounts to purchase bitcoins. The coins are not tracked so they are easy to turn into cash and use for anything. Or, scammers contact people claiming they represent a specific company that offers social media accounts and that the account of the person called is suspended or has some problem that is repairable for a fee. They request a specific amount for the fee to be paid in bitcoins and then disappear with the untraceable payment.
To reduce this type of problem the best way to buy bitcoin with credit card is through a trusted Bitcoin exchange. They should verify all transactions from first-time bitcoin buyers, request some reliable proof of identity from buyers and geolocate with an IP address or by using HTML5 in the browser. In addition, it is also important to know for certain who is requesting any personal information online. Always research a query for assistance or a repair offer independently before providing any approval, payment or information.