This article was first published on: CoinSutra – Bitcoin Community --
I’ve had enough of people calling cryptocurrencies scams. I understand that the crypto space has witnessed many scams but that doesn’t mean the whole industry should be labeled a scam.
This shows the negligence on part of such people who refuse to spend some time learning about the latest revolution. And that is because such people have pre-conceived notions strongly etched in their minds.
Like I stated earlier, there are scams, undeniably, but isn’t it true for every other industry in the world?
Moreover, I acknowledge that fact and that’s why I am here to tell you about some of the most common forms in which crypto scams take place.
Cryptocurrency scams that everyone should be aware of
1. Fraudulent ICOs
The most common way to pull off a scam is to fabricate a fake ICO, create a marketing hype and persuade people to buy.
That is because ICOs are a great and an innovative way to kickstart a company and that is the aspect that is misused. (Read: What Are ICOs ( Initial Coin Offering) & Why Are They Good For You?)
Ethereum has become the breeding ground for these fraudulent ICOs but Ethereum is not directly responsible for it as it is an open-source project.
Instead, it is the ignorance of newbie investors who dream of 100x gains in a matter of weeks by just HODLing worthless ICO tokens.
Usual signs of fraud ICOs or Token Sales:
- Copied whitepaper
- Half team anonymous
- Unusual hurry in execution
- Mismatch of written & said words
- Ignoring hard questions
- No strong reasons for the token economy
- No roadmap
Be aware of such types of scam ICOs or Token Sales. Here are a few examples of fraud ICOs for learning and inspiration:
- Confido disappeared with investor’s $375,000.
- Benebit disappeared with investor’s $ 2.7 million.
- Centra ...