Crypto Investment : Before you make any investments in cryptocurrency, you should research the company or cryptocurrency you plan to invest in. Search for words like “review” or “scam”. Read about common investment scams and how to avoid them. Be on the lookout for emails that threaten to publish your personal information. Do not give in to the threats; report the scam as criminal extortion. Be wary of websites that promise high returns or advance fees.
Pump and Dump Scams in Crypto Investment
The first step to avoiding scams is to know how to spot them. Typically, the scammers target new investors or unsophisticated investors, who don’t fully understand how difficult it is to sell large positions. Because cryptocurrencies are unregulated, it’s easy for people to make exaggerated claims about the potential of a particular project. Unfortunately, this can lead to major losses.
While pump-and-dump schemes aren’t as widespread in the crypto market as they were in 2017, they do exist. Those who promote these schemes on YouTube often tout the potential rewards while downplaying the dangers. But how can you tell the difference between genuine and fake? Read on to learn more about these scams. Here are some tips:
The first step to avoiding pump-and-dump scams in your crypto investment is to be aware of their characteristics. Generally, they target coins with low trading volumes or market capitalization. To minimize your chances of getting caught, stick to traditional stock investments or follow investment advice. Don’t follow tips from unreputable sources. In addition to this, do your homework. Regulatory agencies often reward those who expose scammers and alert the public to fraudulent activities.
Impersonation Scams in Crypto Investment
Scammers use the social media platform to lure victims into believing they are someone they know and trust. They will impersonate friends on Facebook and create fake posts, claiming they have made a fortune from crypto investment. In Australia, scammers posed as Mel Gibson and Richard Branson to make their victims rush to send their money. They also impersonate celebrities on YouTube, where they may impersonate livestreamers or videos.
Another popular scam involves a fake celebrity or government official impersonating a website. These scammers set up phony social media accounts, and then ask people to transfer cryptocurrency to them. This is a classic pyramid or Ponzi scheme scam, which require a constant stream of new victims. To avoid falling victim to such scams, keep up with the latest news on cryptocurrency. You can also check out the Financial Conduct Authority or the Securities and Exchange Commission for more information.
Bogus Websites Promising Guaranteed Returns on Crypto Investment
Beware of bogus websites promising high returns on cryptocurrency investments. These scams can look like legitimate investment opportunities and may feature several tiers of investment. Typically, the higher the investment, the greater the return. Some of these websites may even use fake testimonials or cryptocurrency jargon to encourage investors to invest. They may even make it appear as if your investment is growing, and then instruct you to send more crypto to keep the profit rolling in.
Scams of this kind often promise unrealistic returns with little or no risk. They often appear on social media platforms and scam victims through friend requests. These scammers may ask for remote access to their computer before recommending an investment opportunity. Once they have gained access to their computer, they will direct the victim to a fake cryptocurrency investment website that promises a high return. The victim will soon realize that it is a scam when the site fails to provide the promised returns. The scammer may also try to persuade them to invest more money with them by offering to pay a “tax” on the invested funds.
Advance Fee Fraud Scams in Crypto Investment
There are many types of advanced fee fraud schemes. In some cases, the scammers will require you to send money ahead of time. In other cases, they may even send you fake faxes or ask you to pay additional fees or purported taxes before releasing your funds. In any case, advance fee scams are not uncommon in crypto investment. Read on for ways to avoid becoming a victim of advance fee fraud.
The scams usually start with fake credentials that will require you to log in to a particular Bitcoin wallet website. They may also ask you to change your password or add your phone number to enable MFA processing. This is how they collect your payment information. This way, they can use it for fraudulent purposes. As long as you don’t report these scams, they will get your money without you even realizing it.