Cryptocurrency Scams and Things to Watch Out for

The Five Most Common Cryptocurrency Scams
Investment and Business Opportunities
This type of fraud is also known as “Guarantee Scam” because the scammers promise you guaranteed and risk-free profits. They make promises that are too big and too interesting to be true, and what they really do is sell hope to investors. Scammers use the effect known as “FOMO” or “fear of missing out” to persuade investors to invest in deals that seem too good to be true. However, there is no guarantee of profit in the crypto world, there is always the risk of loss. Therefore, if a website or someone promises you an investment opportunity with a guaranteed profit, we can say that it is most likely a scam.

Initial Coin Offerings and Non-Fungible Tokens (NFTs)
As time goes by, we hear and learn more and more about the crypto world. Most of us are aware of NFTs. NFTs are a popular method that can be summarized as purchasing valuable and unique digital assets with cryptocurrencies. Unlike coins, they cannot be exchanged for another asset of equal value. Many different methods are actively used by fraudsters, including fake NFT stores, various fake impersonations, fake bidding and insider trading.

On the other hand, ICO (initial coin offering) is the first offering of a new coin for sale. Many fake coins are the product of a non-existent history and team. While you may think you are making a profitable early investment in a brand new coin, you may be investing in a scam. You may come across websites that advertise a coin that seems profitable and encourage you to invest immediately. However, you should keep in mind that the advertised coin may not be real.

“Rug Pull” Scam

Have you watched the Korean television series "Squid Game"? Even if your answer is no, most of us have heard about the major cryptocurrency scams that took place after the series was broadcast. As soon as a new coin called “Squid” was launched, there was an investment boom. The creators of the coin, whose value suddenly increased, took all the money and disappeared. These fraudulent activities are called "rug pull" in the market.

Another rug pull method follows a similar pattern in that after first increasing the value of a coin, the fraudsters suddenly sell all their holdings at a high price. Initially, scammers invest heavily in a cheap coin, then manipulate other investors into investing in the same coin. Then they sell all their shares at once, resulting in a sudden drop in the value of said coin.

Classic Phishing Scams

Nowadays, we are all familiar with scams called phishing or baiting. Phishing is a type of fraud that never loses its popularity. The basic system is always the same: you receive an email or message with a suspicious link and a call to action. When you click on the link, fraudsters can obtain many different data, mostly your identity information.

Crypto scammers mainly target investors' digital wallet keys. They create a fake website where they give a special offer for holders of a coin or wallet of a certain size. Such websites require you to log in or share your wallet key in some way. If you share your key, they can access your digital wallet and money. You should be very careful about the emails you receive regarding your money and digital wallet. Always double-check all information, including sender mailing address, images and logo in the post, and always make sure it is secure before clicking on any link.

Identity or Website Fraud

This type of scam is done by various websites or people like celebrities, economists, well-known business people, etc. It occurs by imitating or hijacking the personal social media accounts of reliable sources such as. Scammers can steal the accounts of such people or create new fake accounts that look very real. They manipulate investors with irresistible opportunities through their social media accounts. This is actually a type of investment fraud. Similarly, scammers use the "fear of missing out" effect in this method, but they give this guidance from a reliable source.

How Can You Protect Your Coins from Crypto Scams?

Hear the Alarm Bells

In many fraud cases, there are often similar warning signs that you can notice. For example, in the Squid Game cryptocurrency scam, some investors wanted to sell their coins but could not. Additionally, there were various spelling and grammatical errors on the website of the “Squid” coin. These are just two examples of possible signals of a scam. Other examples could be guaranteed return on investment, errors in logos or images, ambiguities in details, or being constantly encouraged to invest.

Decide Carefully When to Pay with Cryptocurrency

If someone asks you to pay with cryptocurrency, it's most likely a scam, it's actually that simple. Cryptocurrency is not fully controlled by the government and if you transfer your coins to someone, there is no way to get them back. This is exactly why scammers prefer crypto payments so they can easily pocket your money. Therefore, you should do your research well before paying someone for an asset.

Take Good Care of Your Wallet Key and Credentials

As we mentioned before, if you use a digital wallet, your key and credentials are login information, each different and unique, that protects your investments. As with most other accounts, you should always use two-step authentication and store your crypto credentials offline if possible. Because unfortunately scammers have access to almost all online platforms.