Common Cryptocurrency and ICO Scams To Look Out For

Are you looking for a quick return on investment platform? Have you been promised by some random guy multiplication of your bitcoins or altcoins on investment? Well here is the truth and nothing but the truth – it’s probably Scam.

There are many opportunities on the Internet. At the same time, risks and uncertainties abound putting your money at risk. Let’s take a look at some of the Do’s and Don’ts in the world of Crypto.


  • High Return on Investment and Quick Money Schemes

You want to multiply your cash overnight or get a return on investment (ROI) within a very short period of time. People behind these schemes understand your wants more than you and that’s why they build platforms promising returns. Most of them claim to be traders who have perfected the art of trading while others claim to be miners willing to sell you hash mining power which will generate you cryptocurrencies in exchange for your cryptocurrencies.

These quick high-return promising opportunities are common on various Facebook groups and are very good at luring new ones into the crypto space.


  • Random Social Media Investors

Instagram, Facebook and Twitter are some of the social media sites where you are likely to come across fraudulent individuals who will try to lure you into lucrative deals.

So this is how they do it:

  1. Spark a conversation.

2. Ask you to view their profiles which is full of flashy high lifestyle images.

3. Propose to show you how to make money and be rich like them.

4. Share images of their families and themselves which are fake. (Imposters)

5. Ask you to invest as little as you can.

6. Promise returns and share proofs of other investors earning and giving feedback.

7. Insist that you’re missing out on promos and whatsoever.

8. Engineer reverse psychology tricks on you.

Most of the social media sites will even block or close such accounts. You can play your part by reporting such accounts for fraudulent activities.


  • Phishing Sites and Malicious Software

At the time of this writing, there are thousands of fake phishing and malicious softwares online. Most of these sites’ softwares claim to offer free cryptos or multiply your investments.

Once granted access, phishing sites are able to access information stored on your device thereby comprimising it and enabling them to access your accounts info. Malicious softwares happen to do the same.

When you do a Google Search, say for an exchange, always make sure that you are on the right URL to avoid getting phished. It is advisable to follow links embedded on trusted cryptocurrency platforms. Avoid clicking links from random sites or random individuals on the Internet.

To further protect yourself, ensure you have activated malicious software defenders.


  • Fake Cloud Mining Sites

Some cryptocurrencies, such as Bitcoin, have certain algorithms which allow for rewarding of people who add new blocks on the Bitcoin blockchain. The process of adding new blocks on the chain is known as Mining.

To mine you need to have computational power (Hash power) which is normally harnessed by computer devices such as Asic Computer Processing Units (CPUs) and Graphic Processing Units (GPUs). Cloud mining sites make it possible for you to add purchase hash power online and start mining. Fraudsters nowadays are coming up with fake cloud mining sites and fake rewards. So, you will purchase your hash power (Fake hash power) yes, and you will start mining (fake mining) while your earnings are displayed on your dashboard. For a moment you will be a happy man until you try to withdraw your earnings in bitcoin. You will probably get an error, or in some cases, the transaction will be successful only to realize that nothing was really sent.

Always do your own research (DYOR). Pay close attention to the sites reviews.


  • Fake ICOs and Airdrops

Initial Coin Offerings have become the new way for startups to raise money to fund their organizations without necessarily involving legal frameworks and bodies. Airdrops, on the other hand, is a marketing tactic employed by crypto-based startups to create a community. During Airdrops, free tokens are given away in exchange for your time to do some simple tasks such as follow and share on social medial platforms. Startups that Airdrop end up raising funds via ICOs as well.

Out of all ICOs done, 80% were scam and so did the Airdrops. Watch out for fake ICOs and Airdrops by looking for the following:

– Team of Developers.
– Disclosed Developers Identity. Disclosed Developers Identity.
– Working Viable Product. Absolutely Free.
– Listed on Certified ICO Platforms Listed On Certified Airdrop Platforms
– Viable and visible product.
– Involved developers (Webinars) Involved Developers (Events, Webinars)

Read more on Airdrops here


  • Pump and Dumps

Pump and Dump, just as the word goes, is an action of manipulating prices by sharing fake fundamental news to push prices up. You will come across such channels mostly on Telegram where the organizers of the pumps and dumps make calls on random cryptocurrencies asking them to buy at an agreed time of the day.

99% of people who participate in Pumps and Dumps lose their coins. The 1% who make profits from these activities are the organizers who buy the (to be called on token) a day earlier and sell it at the time of the call when the members of the channels are busy buying. Normally, it only takes a few seconds before the pump and dump is over. Many end up selling at a lower price than they bought henceforth incur losses.

Obey one simple rule of investing in shares or cryptocurrencies – buy when everyone else is selling, and sell when everyone else is buying.


  • Cheap Cryptocurrencies and Fake Support Teams

To begin with, you will never get cheap BTC. Nobody sells bitcoins at a lower price than the market price. It beats all logic. Chances are that anyone selling cheap cryptocurrencies is a scammer.

Genuine support teams will never email you asking for your private log-in credentials and they will never ask for Eth or any crypto in return.

Stay away from individuals who ask you to help them withdraw cryptocurrencies from some unknown sites claiming that they cannot withdraw because of some country related jurisdictions. Always confirm transactions on the relevant block explorers before exchanging any crypto for cash. It’s recommended to use escrow in any transactions.


  • Fake Wallets and Exchanges

In simple terms, a wallet is a digital purse where one can store his or her digital assets such as Ethereum. An exchange is a platform that allows users to buy and sell cryptocurrencies from each other without necessarily having to meet. Exchanges match bids and asks from different users. Fake exchanges and fake wallets collect your deposited cryptocurrencies.

Always make sure that you do research before registering on any Exchanges. Visit CoinmarketCap to view some of the existing exchanges that are safe and have liquidity. Always store your wallets private and public keys safe, and preferably, offline. The only way one can recover his or her wallet is through these keys. Do not share your keys with anyone, not even your relatives.

Take your time and familiarize yourself with some of the existing Common Cryptocurrency wallets

It is recommendable that you always do your own research, never invest money you cannot afford to lose, be vigilant, be patient, never let greed contribute to you being duped and as the internet evolves, evolve with it.