FTC Issues Warning on Bitcoin Blackmail Scams

The U.S. Federal Trade Commission (FTC) is warning consumers about a new type of bitcoin scam that attempts to blackmail men.

Scammers are sending letters threatening to expose an alleged secret to men, and asking for a "confidentiality fee" paid through bitcoin, wrote Cristina Miranda, a member of the FTC's Division of Consumer and Business Education on Tuesday.

An example letter stated:

"I know about the secret you are keeping from your wife and everyone else. You can ignore this letter, or pay me a $8,600 confidentiality fee in bitcoin."

The letters reportedly also provide instructions on how victims can make these payments.

The education division, whose goal is to protect consumers from deceptive and unfair business practices, also provided guidance on how men can avoid losing funds to bitcoin-related blackmail scams.

The agency recommended that potential victims report letters "immediately" to both local police and the FBI.

While the FTC specifically said the scam is targeting men, comments suggested that it may also be targeting women. One comment, by username Hana, said "I am a female and have also received a similar threat."

"The email had somehow confiscated one of my passwords and threated to use pictures, etc. to make pornographic videos and posters using my face. They also demanded that I pay thousands of dollars in bitcoin," she added.

This is not the first time that the FTC has discussed cryptocurrency-related scams. As CoinDesk reported previously, the agency also hosted workshops on cryptocurrency scams and fraud back in June.

Federal Trade Commission image via Mark Van Scyoc / Shutterstock