Cryptocurrency is a type of digital coin that can be used to buy and sell goods. Many retail investors and institutions, on the other hand, treat crypto as investments rather than means of exchange, purchasing certain coins to sell them for a profit at a later date.
However, investors should exercise caution before investing in these commonly misunderstood assets. Cryptocurrencies are by their nature very speculative. They don’t have standard fundamentals that investors can examine and assess. As a result, crypto are very volatile assets, with prices fluctuating dramatically. In general, cryptocurrency markets are less regulated, making it simpler for corrupt individuals to manipulate prices and take advantage of naive investors. That’s why you should be aware of the following crypto frauds.
1. Fake Websites:
If the URL bar doesn’t have a lock icon, “The site isn’t secure” or you get redirected from one site to another while making payments. The redirect link may appear to be a valid site, but a closer look at the URL reveals that it contains the number zero rather than the letter “o.” As a result, it’s critical to double-check that you’ve entered the correct URL!
The purposeful attempt to artificially influence or interfere with asset prices is known as market manipulation. Scammers typically manipulate markets to shift the balances in their favour and profit quickly. This umbrella phrase encompasses a variety of illegal trading practices.
3. Fake People:
Scammers frequently resemble government leaders, organisations, or well-known individuals. These frauds are carried out with fiat money. Fraudsters are well aware that users place a high level of faith in authoritative speakers. As a result, they make fictitious videos showcasing cryptocurrency founders and co-founders, as well as notable individuals linked with crypto companies or CEOs who have discussed the acquisition for their balance sheets.
4. Dating Scam:
These scams take advantage of online dating to lure victims into pyramid schemes.
To avoid becoming a victim: Never send money or invest based on the advice of someone you met on the internet, and never discuss your financial matters with strangers. It’s critical not to fall into the trap of people who claim to have investment opportunities since scammers strive to get you to do something as soon as possible.
How can you tell if a crypto project is real or not?
Examining the core team behind any project is one of the most straightforward ways to determine its legitimacy. This information will be available on the project’s official website.
Lawful websites provide contact information for their primary team members and links to their LinkedIn pages. This basic procedure can protect one from investing in a dodgy project, particularly given the FOMO that sometimes surrounds such unrelated initiatives.
Spend some time on the project’s official website and If it exclusively mentions purchasing their crypto token and how it will increase 100x in the next few days, this is a clear red flag. Review the project’s social media outlets and if their Twitter profile appears to be dead or contains only a few postings. That’s a Red Flag!