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Exploring The Types Of Crypto Scams, How They Work, And How To Avoid Them

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Exploring The Types Of Crypto Scams, How They Work, And How To Avoid Them

Scammers have well-orchestrated procedures for carrying out their schemes on unsuspecting persons. Some are little subtleties that can be evasive, even to those who are well-versed in the realm of cryptocurrency. 

By Caroline Akinyi
February 21st, 2022

 

 

One of these schemes is to oversell something. We’ve all seen how these things function in real life, right? If you repeat it too often, it will get ingrained in people’s thoughts, and they will believe it is the finest available. Even if it isn’t, they want to try it out to see what all the fuss is about. 

 

In my dialect, we have an adage that goes, “The good sells itself, while the evil spreads easily.” That’s a literal translation by the way. Anyway, the point is that they take advantage of the fact that people will always fall for what’s popular. So just because a cryptocurrency is getting a lot of attention doesn’t mean it’s necessarily a wise investment. Especially if it is a new product on the market. Conduct thorough investigation to ensure it is genuine. 

 

Second, they’ll create a Discord server for the same purpose. It’s the current trend in all things technological. Discord server for new currency, Discord server for fans of NFT collections, as well as everything else related to web3 and blockchain, have a Discord server for their users, buyers, or supporters. They set up a discord server to erase any suspicions in the minds of their targets. There are scammers as well inside the legit company discords and they’ll often send you private links. To prevent falling for this scam, do not click on any links sent on social media to new discord servers for NFTs or cryptocurrency you are unfamiliar with. Also, don’t click on links provided to you privately on Discord. Server administrators typically post any links linked with their products to public servers. Just stay away from any personal business in your social DMs. If they exclude you from the public eye, it suggests they’re laying the groundwork for manipulation. It is much easier to take from you when no one else is challenging what they are telling you in private. 

 

The third method is to use bots to increase interaction. Some of the many engagements you see on a post or followers on an account may be bots designed to create the illusion of widespread public interest in that particular cryptocurrency, NFT, or app.

 

With the advancement of technology, many previously inconceivable things have become attainable, such as phony followers, engagements, and digital services. One thing to keep in mind is that they won’t be able to do so for long. I mean, you’ve got to get weary of writing material and reacting to yourself at some point. Purchasing your own artwork or establishing fictitious users to give the impression that a large number of individuals are utilizing your platform to purchase cryptocurrencies and non-fungible tokens is a smart idea that can’t last. So don’t rush to join new apps or forums that claim to sell your NFT or use it to acquire cryptocurrencies. You risk losing both your money and your work. 

 

Fourth, is fake sales. They use shadow wallets to acquire their own NFTs to make you believe their NFT collections are in high demand, so adding your art to theirs means you’ll sell more rapidly. When we place our art on the market, we expect it to sell, so if you wait a few days, then days develop into weeks and months, it may be disheartening and lead to givingup. So it’s only natural that if a promise of obtaining clients comes your way, you’ll want to take advantage of it. But be cautious when boarding the bus you’re hoping for. The purchasers may be nonexistent, and you may believe you are selling, but you are simply giving away your NFTs to someone who will then sell them for their own profit. 

 

Before you acquire cryptocurrencies or utilize any site to sell your NFTs, make sure you’ve thoroughly researched and confirmed these points. Know the creators. Look into their backgrounds.

 

Their online reputation must be solid. If anything appears suspect, such as a lack of complete information about them, their company, or their projects, it’s a red flag. We live in a digital age.

 

Almost every firm that wants to be regarded seriously these days has their company and all of their executives mentioned on their website, LinkedIn, or Wikipedia. If Google can’t find them, you won’t be able to either when they steal your money. 

 

Follow their social media handles to see if the dialogues are genuine and not fabricated. Bots can simply automate generic messages. Check if the company is also active in the discussion. Responding to questions and concerns voiced by users. That demonstrates excellent customer service. 

 

Check and double-check the names of websites, NFT projects, cryptocurrency wallets, decentralized apps, and anything else related to web3. Scammers might change or remove one letter in a name which you can miss if you are not cautious. Or add hyphens and extensions to the site name. If you’re not diligent, this can be difficult to find. 

 

Another red flag could be the manner in which the project is minted. for example dutch auctions that begin with starting prices as high as one each are typically a bad sign since it indicates that the owners are more concerned with collecting cash than with offering access or recognizing actual project backers and whitelisters. If not familiar with it, in dutch auction, the price of the mint starts high and drops every few minutes if there is no demand, so you can understand why this is misleading.

 

NFTs are a hot commodity right now, so be sure to exercise caution when purchasing them. Be on the watch for any strange activities or red flags that can indicate a fraud. Also, if you’re new to the metaverse, stick with the more well-known companies.

 

Disclaimer: The information above does not constitute investment, financial, trading or any other sort of advice and you should not treat any of the content on this site such. We do not recommend the purchase, sale, or holding of any cryptocurrency or other product. None of our content should be deemed as an offer to purchase, sell, or hold a cryptocurrency or other product or service. Please consider doing your own research and prioritize consulting a certified financial professional before making any investment decisions.

Published by Caroline

Hello, meet Caroline. Author of "The Rising Blood," a software developer and blogger. Traveling, reading, hiking, collecting artifacts, and creating small code projects are some of her favorite pastimes. She writes about technology, lifestyle, and life tips on my blog. Follow her blog if you're interested in keeping up with the latest tech news, web3, how to make your life easier with technology, or the latest start-up that's making fantastic stuff.