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4 Common Cryptocurrency Scams You Should Watch Out for in 2022 | Ask The Experts | #socialmedia | #hacking | #aihp




4 Common Cryptocurrency Scams You Should Watch out for in 2022

 

A lot of people are interested in making money from cryptocurrency, but the industry is still relatively new and risky. If you’re new to cryptocurrency, you might be wondering what kinds of scams you should watch out for—and how to avoid them. We’ve put together this list of 4 common scams that we think you should know about as you navigate the crypto world.

Pump and Dump Schemes

The first rule of the Pump and Dump club is: DO NOT TALK ABOUT PUMP AND DUMP CLUB. Okay, that’s not true. You don’t have to talk about P&D schemes, but you should be aware of them. When it comes to crypto scams, they are some of the most common types out there. 

Crypto is a relatively new asset class with few regulations and lots of excitement around its potential as an investment vehicle. This combination can make for ripe conditions for scammers. That being said, if you know how to spot a P&D scheme, you’ll be miles ahead of anyone who doesn’t even know what it is (a little crypto humor there).

So what exactly is a pump and dump scheme? Basically, it’s when someone or a group of people try to artificially inflate cryptocurrency prices by pumping up the hype around it. They then sell that asset at its inflated price and dump their holdings while leaving everyone else holding the bag (or in this case, probably something like XRP).

ICO Scams

An ICO, or initial coin offering, is a type of fundraising activity in which investors purchase tokens at a discounted rate in exchange for their cryptocurrency. This is one of the most important and common ways that new crypto projects are able to raise money, start their businesses or communities, and enrich the cryptocurrency market. 

However, due to the lack of regulation in this space and the potential to make incredible amounts of money through an ICO — as well as the fact that ICOs have little oversight until they’re underway — it’s become easier for scammers to take advantage of unsuspecting people by launching fake ICOs. These scams are becoming increasingly common, and there are several things you should look out for before investing in any type of cryptocurrency online. 

Romance Scams

Romance scams happen when someone creates a fake profile to target people looking for relationships online. Romance scammers pretend to be interested in the victim, usually by sending love letters, links to meaningful songs, and talking about their feelings. 

The scammer builds trust with their victim and then asks them for money, often under the guise of needing it for travel costs or medical expenses. If you’re using online dating platforms, be careful if someone you met online asks you for money. It’s best to keep your guard up until you can verify who they are in person.

Fake Investment Platforms

It’s important to do your due diligence on a platform before investing. You should be looking at reviews, scam reports, the time the platform has been in business, and other relevant data. If possible, you should also check out the founders of the platform and see if they have any experience in running similar projects or companies. This can be surprisingly easy to do if founders are public about their past activities on LinkedIn or other social media platforms.

Another red flag is unrealistic returns. If an investment opportunity promises that you will raise cryptocurrency value in a very short amount of time, it might be too good to be true. However, this doesn’t mean that cryptocurrency investments don’t have high returns—plenty of them do! It just means that if you’re going to invest based on potential returns, make sure those returns seem reasonable given historical performance and market conditions.

Suppose you see an investment opportunity where there isn’t a whitepaper available during your research process. In that case, that’s another red flag indicating that maybe this isn’t a legitimate project after all. A whitepaper is essentially a roadmap for an organization’s goals and objectives around technology development as well as how its operations will work once fully developed.

Crypto Giveaway Fraud

Giveaway scams are one of the oldest tricks in the book. Scammers use fake accounts to impersonate celebrities and CEOs who often have a large social media presence. Then they announce that they’re giving away cryptocurrency, tricking people into sending them cryptocurrency to receive some back (which, of course, never happens).

The cryptocurrency market is full of exciting opportunities, and it’s easy to get swept up in the possibilities. But remember that with those possibilities come dangers. It’s important to stay vigilant when trading or buying cryptocurrency.

 

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National Cyber Security

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