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    How To Tell That A Cryptocurrency Deal Isn’t Legit

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    Scams and fraud are evolving realities we all face when operating in the virtual space. Whether placing bets on the best online casino or making a simple online purchase, you’re always at risk of being tricked into having your personal and financial information exposed to parties that only want to take advantage of your details without your knowledge.

    When it comes to crypto investments, the risk is no different. And because many traders are constantly looking for opportunities to grow their investment portfolio, they open themselves up to frauds and scams that could cost them a lot of money.

    However, suppose you know the common signs and red flags to look for. In that case, you’ll be able to identify such instances quickly and take necessary action to protect yourself accordingly.

    Wanting Crypto-Only Payments

    Suppose a retail establishment or ‘credible’ person insists on being unable to accept any form of payment other than Bitcoin or Ethereum. In that case, the transaction is likely to be a scam.

    According to experts, Bitcoin and other leading altcoins are considered a burgeoning asset class. This means legit institutions and people won’t accept crypto alone without making room for other fiat currency options through online payments like card payments, wire transfers, checks, and cash.

    Fake Or Anonymous Identities

    The fact that KYC protocols don’t exist on blockchain makes the entire process questionable. But this cannot be avoided forever because, in due time, law enforcement agencies existing on every municipal level will begin to implement new tools that they can use to investigate scams that are on smaller-scale blockchains.

    In the meantime, there’s still a possibility that digital blockchain assets, NFTs, and crypto tokens could be used by criminals to engage in money laundering activities on small and large scales.

    By sticking to beginner-friendly crypto exchange platforms like Gemini and Coinbase, you can avoid risks that generally surface with trading on smaller, less popular, niche exchanges. Also, it’s best to begin the trading journey by sticking to popular cryptocurrencies like Bitcoin and Ethereum since these cryptos have a longer track record that shows an increasing value compared to others that recently entered the market.

    Games And Digital Collectibles

    Sophisticated coders can create imaginary worlds and new games on the blockchain. So, when a scammer wants to take advantage of this, they will entice excited blockchain beginners into buying a newly minted token or coin to get the game.

    When there’s enough demand, the price will go up for the game, giving the scammer a chance to sell all of their holdings and disappear. This move is called a “rug pull.”

    Unlike what you’d find with a bank account where you have FDIC insurance or fraud protection when you’re victim to the “rug pull”, your money will get stolen, and the only way to get it back is if the recipient reverses the payment.

    As most experienced traders would know, this kind of gesture is highly unlikely to happen because all of this happens on a decentralized exchange.

    Crypto Investment Schemes

    New cryptocurrencies are being minted and launched on the blockchain as an initial coin offering (ICO). Though this may be an exciting time for founders and investors to try something new to find another lucrative opportunity, it also means scammers have a new way to create opportunities for themselves.

    When a founder in the form of a company or individual presents an offer that sounds too good to be true, they may add a lot of pressure to the deal so you can deposit several new coins into a digital wallet that’s already been messed with. Or you could be pressured into buying the coin and selling it when the price explodes.

    Romance Scams And Phishing Scams

    Romance scams are when scammers pressure buyers to buy specific new crypto simply because the relationship was established on a dating app. And then phishing scams are when scammers bait recipients through enticing emails so the recipient can click a specific link and share personal details.

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