btc-plaza – a scam exposed

What is it?

btc-plaza is a simple Bitcoin exchange. They offer BTC/USD, LTC/USD, BTC/EUR, and LTC/EUR. They proudly say that they are a great digital exchange.

The site is well built and looks legit, the way you can deposit/withdraw funds with either by Skrill, Bank, PayPal, or OKPay.

The Scam

As of 6/23/14 People on reddit have reported that coins were sent to their Bitcoin address and the funds were never deposited to their for of payment. Adog353 on reddit said:

PLEASE do not give your money to these scammers. Stop fucking sending people money based on reddit threads and do your research.

In fact, btc-plaza had shills who would falsely advertise on reddit about how much money they made from btc-plaza. Examples of such threads include:

http://www.reddit.com/r/Bitcoin/comments/28vzoq/i_sold_146_btc_at_btcplazacom_with_bank_transfer/cif42bf

The thread read:

I made a sell of 14.6 Bitcoin at btc-plaza.com with the Bank transfer option. I received the funds in my bank account (in euros) and when i checked there were 22% taken away after the first transaction. I asked the bank for a report and they informed me that the government took 22% of the whole transaction as tax money! wth? what should i do to regain this money? how can they take tax so fast and without informing me??

It really tried to socialengineer users into selling their BTC on btc-plaza. It brought attention to the government taxing taxes on Bitcoin but at the same time send a subconscious message that btc-plaza is a great site where selling 14.6 Bitcoins valued at roughly at $8683 is no big deal.

The clues

There are not many clues that the site has left, but here is what the reddit community has so far.

1ExR8rKj7CeZ9xQjrfgUjXNZqUxbGXDCbp

The above is one of the addresses to which the Bitcoins that were supposed to be sold on btc-plaza were sent to. btc-plaza never made a payout according to the buyer so the 2.01732 BTC that is in that wallet are considered stolen.

On their site btc-plaza has a WhoIs Guard on their domain which means that the true identity of the real owner of the domain is concealed from the public’s view. The identity however could be retrieved if the authorities issue a subpoena to the WhoIs Guard.

The above information is most likely bogus, but on their site, under CONTACT they display some contact information, including their company phone number (+39) 346-304-3460 Their email address contact@btc-plaza.com and their location:

Via Monti Sabini 3 Milano, Italy.

Finally, we have their twitter account under @Btplaza UPDATE: @btplaza is apparently not linked to the exchange site btc-plaza and is in no way related to the scam, check out the comments section. With all the information in hand a simple subpoena should release the logs of their WhoIs guard should lead to a matching IP.

Lessons Learned

As a lesson we should learn not to trust new companies offering “too good to be true” type services, especially if the company’s domain is not fully transparent and has a WhoIS Guard. If you would like to see other scams that have recently occurred, take a look at this phishing site which appeared on the top page of Google and imitated the popular blockchain.info, or maybe Coin.MX which was found to have a major vulnerability in their security allowing anybody to deactivate an account based on just the email. Finally, here is an example of a malware that mines coins on your computer.   As a tip for the future when attempting to use a new company’s service do a basic background check about the company, a simple WhoIs search for the domain and a Google search for reviews will reveal if the company is legitimate or not.

Furthermore, there are far better alternatives that are well established and are known to be legit. Localbitcoins is a great site that allows criaglist type Bitcoin trading in many forms of currency, the trades are made between individuals and and are based on escrow and reputation. Thanks to jerguismi here are are few alternatives:

To people looking for alternatives, LocalBitcoins has lots of reputable traders offering these payment methods:

https://localbitcoins.com/sell-bitcoins-online/moneybookers-skrill/

https://localbitcoins.com/sell-bitcoins-online/sepa-eu-bank-transfer/

https://localbitcoins.com/sell-bitcoins-online/paypal/

https://localbitcoins.com/sell-bitcoins-online/okpay/

There is escrow protecting the trades, also a reputation system. However escrow alone should guarantee that you will see the proper amount in your account, as fast as possible.