Types of Scams in the Crypto Market

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Hello everyone, most of the topics in the forum are about how to make money, while discussions about preserving and preventing scams are scarce. So today, I want to share an article with you about common scams in the crypto market. I hope it will be useful to you.

Impersonation of Famous KOLs and Influential Figures:
This is the most common form of scam, where scammers create fake accounts impersonating famous individuals in the crypto market, such as Elon Musk. They post information about giving away free tokens and ask you to donate to their wallet in exchange for rewards. These scams are mostly found on social media platforms. Scammers create fake Telegram groups, fake communities, and employ bots to promote these scams. Their goal is to promote worthless tokens, lure people into private groups, and charge fees before disappearing.

Receiving Unexpected Tokens in Your Wallet:
If you frequently participate in airdrops or store tokens in your wallet, you may suddenly find some unfamiliar tokens with significant values. Scammers use this tactic to tempt you into selling the tokens, but when you try, you discover that you cannot. This was a prevalent scam in the latter months of 2021, targeting new investors who were not familiar with the technologies being used in the market.

Fake ICOs and Untrustworthy Projects:
Some scams involve fake ICOs, where organizations create a token, collect investments, and then disappear. They often vanish after receiving enough money, causing the token's value to plummet. Examples include the Confido ICO scam in 2017 and tokens like Squid, which mimicked the popular Squid Game. Sometimes, even if you invest privately, they refuse to release your tokens.

Shady and Scammy Exchanges:
While exchanges like Binance, Kucoin, Houbi, and OKX are reputable, newcomers can be lured into untrustworthy exchanges. Scammers may entice users with high-profit advertisements, but in reality, these exchanges may prevent you from withdrawing your funds. Another common scam involves fake exchanges promising significant winnings, but you have to pay taxes before you can withdraw. Once you transfer the money, the scammers vanish.

Promised 100% Profit Guarantee:
Any investment involves both gains and losses, and no investment can guarantee a 100% profit. Promises of quick, massive profits are clear signs of a scam. These scams often start by showing initial profits and then encourage you to invite friends. Once they receive investments from you, your friends, and others, they disappear.

Impersonation of Apps and Websites:
Many popular websites like Binance, Houbi, and Metamask have counterfeit websites with identical interfaces. Scammers may also create fake apps for Android devices that steal your login information when you enter your password.

Account Theft:
Scammers may impersonate helpful individuals when your Binance account is locked, promising to recover your money for a fee. They may also pretend to be Binance employees, sending emails claiming issues with your account and requesting you to click on links to resolve them.

Ponzi-Like Projects:
Many crypto projects have elements of Ponzi schemes, where early investors are paid with funds from new investors. These schemes can collapse when they can't attract enough new investors.

OTC Scams:
Over-the-counter (OTC) trading involves direct agreements between buyers and sellers. Untrustworthy individuals in OTC trading may take your money or engage in money laundering.

Impersonation of Funds and Relationships:
Some scammers claim their project has partnerships with large funds to gain trust. Verify such claims and don't invest without thorough research.

II. Ways to Protect Yourself from Scams:

*Avoid projects promising unrealistic profits.
*Never share your private keys.
*Block and report suspicious individuals.
*Research projects thoroughly.
*Keep your assets in separate wallets.
*Be aware of your own position and benefits.
*Verify the authenticity of claims.
*Check app and website credibility.
*Stay vigilant and don't let greed cloud your judgment.

I hope my article can help you avoid losses, but ultimately, it depends on our own vigilance. Don't let greed overshadow your rationality!