Learn how to – Detecting and Avoiding cryptocurrency investment scams

Learn how to – Detecting and Avoiding cryptocurrency investment scams.

In the last few years, cryptocurrency investment has become a smart way to make money. With more people investing in coins, it becomes increasingly difficult to tell what’s legitimate and what’s not. There are now so many scams associated with cryptocurrency that avoiding them can be extremely difficult, even if you know what to look for. 

Cryptocurrency investment scams are rampant on the internet and seem increasingly sophisticated over time. Even experienced investors can fall victim to these scams, so you must learn how to detect them before you make your first investment. These scams are widespread, and many investors have lost their money. This guide will help you identify cryptocurrency investment scams and avoid falling victim to them so that you can make money without risking your finances. 

How do crypto scams work?

As people are increasingly interested in cryptocurrencies, scammers are taking advantage of them. If you’re considering purchasing initial coin offerings (ICOs), doing your research first is essential. However, many new investors don’t know how to spot potential scams and lose money. A study by Cambridge University estimates that almost 10% of investors in ICOs have been scammed out of funds. Before throwing any money at an investment opportunity—whether digital currency or otherwise—do thorough research into companies/products before jumping on board with them. This will help ensure you won’t lose any money if something goes wrong. 

Scams To Watch Out For

These days, it seems like there’s no shortage of ways to lose your money online. Although many investors are wary of fraudsters trying to take advantage of them, others are less experienced or more willing to roll their dice. But even if you have years of experience trading cryptocurrencies, it’s easy to fall prey to a scammer—especially if they’re a skilled con artist. That’s why it’s essential to know how scammers operate, their most common tactics, and how you can protect yourself from being caught in one of their traps.

Crypto Exchange Scams

There are many different ways people try to scam you in crypto, so let’s get started with exchanges. The most obvious is charging high exchange fees, which generally run around 0.2% to 0.5%. This may not seem like much, but it adds up when buying more expensive coins or tokens, especially if you deal with many volumes. Don’t fall for it—crypto trading should be as cheap (or cheaper) than traditional stock trading. 

Make sure to do your research before using any exchange. If they have a history of bad customer service, poor security practices, poor communication channels, or slow/faulty withdrawals, it’s probably best to avoid that particular platform. Always make sure you send your crypto offsite after purchasing through an exchange. Most crypto exchanges will keep your private keys in one place; don’t leave your assets under their control.

How to avoid a scam

Many crypto projects are built on hypes, similar to the way businesses contract seo company’s; most crypto projects contract Social media influencers to promote and encourage people to invest. No matter which celebrity or Twitter influecer endoses any crypto project, you should tread carefully and ensure you do proper research before investing your money.

While blockchain is an exciting new technology, it’s important to remember that it’s still very much in its infancy. New cryptocurrencies are popping up every day, but few of them have a legitimate shot at improving upon or replacing existing currencies (despite what their marketing might lead you to believe). If a coin doesn’t offer a truly innovative solution to a significant problem—and isn’t built on an incredible foundation—it is probably best avoided. Stick with coins with utility. A coin must earn its value before it can start making a profit for you.