Scammers always find their way in financial markets. They steal traders’ money through advanced technology which many of us are scared of. The growth in the number of scams is increasing which is a matter of concern.
Cryptocurrency market is a new digital market and it has also in small time faced many scams. Therefore, today we’ll be focusing on common cryptocurrency scams and how to avoid them for beneficial trading.
Common Cryptocurrency Scams
Cryptocurrency is a digital financial market. The decentralised market is prone to many scams due to the fact. Here we have discussed some of the common crypto scams which traders can be aware about:
Scammers in the market create fake websites. These fake cryptocurrency trading platforms attract traders with their low cost trading schemes and advanced facilities. The websites usually look similar to the best trading platforms online. These mimic the domain name and design of their websites. Thus confusing the traders.
So, traders need to be careful of identifying the original websites.
Cryptocurrency phishing scams often targets the information relating to online wallets. The scammers use it to target the crypto wallets private keys. They use it to access the funds within the wallets.
They send mails to lure the recipients with a fake website like original platforms.
Pump and Dump Scams
The pump and dump scheme involves coins or tokens whose value is manipulated. They hype the price of coins and tokens using fraud activities. They send fake emails or use social media platforms.
Traders do not check the authenticity and run to buy coins online. After inflating the price they sell the coin which causes a crash in the market. The coin value declines within minutes and traders lose their money.
The giveaway scams in cryptocurrency offer the traders to match or multiply their cryptocurrency sent to them. The messaging is clever and looks like original websites.
This creates a sense of originality and users fall for it.
Get Rich Quick Schemes
The investment type is to lure traders. The websites or platforms offer traders with schemes that offer them to make money instantly. Many users fall for it as they are not able to earn from the market for a long time.
It should be noted that there is no such short cut for one to earn quickly in financial markets. So, these quick earning schemes are fake and a pitfall for traders online.
How to avoid crypto scams?
Traders can come across many scams and they need to take measures to avoid them. Here we have the tips that traders can follow in the market for profitable and successful trading.
- Do your research before trusting any platform
- Make sure the website you visit is legitimate
- Always check the last part of the URL a legitimate and scam page URL has great difference
- Always choose reputable platforms to trade
- Do not click on links which come through emails if the sender sounds fake or scam.
- Confirm the emails are legitmate before opening them
- Never enter your login credentials on any website. Always check the authenticity of the platform.
- If anyone researches you through messages or social platforms. Never trust them without checking the platform’s authenticity.
- Avoid under the tabel dealings
- Never trust the instant earning schemes
- Think rationally and control your emotions
- Avoid investing in unregulated and unknown platforms
- Do not let anyone FOMO you into investing in. Especially the ones with instant or guaranteed earnings.
Trading in financial instruments is a good opportunity to earn money. However, the market is full of scammers that try to steal traders’ funds. In light of this the article discusses cryptocurrency scams which have become common.
Also, how traders can avoid these scams for profitable and successful investments. Traders can use these guidelines to avoid the scams and make efficient investments over the time.
A legitimate platform never guarantees earnings and will not send emails asking for information. So, traders need to be careful when trading online. v