As cryptocurrencies are gaining popularity, the number of frauds targeting investors is also increasing. From phishing attacks to fake exchanges, scammers are continually using fraud tactics to deceive individuals new to the crypto world.
Among the various types of crypto scams, Pump and Dump Schemes are one. In type, false marketing to inflate the crypto price is done. Once coordinated purchasing drives up the price, fraudsters sell their respective holdings at a profit, causing a sudden decline in the price and large losses to inexperienced investors.
In this, individuals are tricked into divulging their login credentials by fraudsters who impersonate legitimate cryptocurrency exchanges or wallet services. This usually happens through emails, text, or social media messages.
Here, fraudulent websites that mimic real cryptocurrency exchanges are used. Investors are lured with promises of high returns or special bonuses. After funds are deposited, victims find themselves unable to withdraw their assets, as the scammers disappear with the money.
1] Read The White Paper Thoroughly: Before investing in any cryptocurrency, one must carefully examine its white paper. A legitimate white paper provides detailed and clear information about the project’s technology, objectives, and operations. A poorly written one could be a signal of a scam.
Before investing, one should look for detailed profiles and past achievements of the crew members as it will ensure whether the team is reliable and transparent or not. If the team is anonymous or lacks credibility, it may be a red flag.
Be wary of anything that offers easy profits such as free coins or tokens or even high guarantee returns. Accepting these should be done only after a thorough investigation and financial commitment.
