Ways to Identify Common Digital Currency Frauds

People are also getting attracted to digital currency, also referred to as cryptocurrency. However, the transactions associated with these currencies also involve some risks. To be clear, we are not referring to market volatility. Financial fraud is everywhere, and cryptocurrency has no exceptions. If you plan to invest in such cryptocurrency platforms, be prepared for the losses involved in these digital exchanges.

However, if you get duped by cryptocurrency or Bitcoin scams, you can consult with Bitcoin scam recovery experts – and also adopt the common primary measures to identify it before it happens. They have a thorough understanding of this industry and can guide you to recover from your loss.

Identifying Common Cryptocurrency Scams to Avoid Them

Let’s go through some common ways through which scammers make the investors their victims. Being aware of these ways can help you avoid these digital investment scams and enjoy the benefits of cryptocurrency.

1. Duplicate Websites

Sometimes you may follow solid advice from an industry expert to invest, but still get scammed because of these duplicate websites. Surprisingly, the scammers are designing websites that look identically the same as the original website. Always look for a small lock icon next to the address bar, which indicates the website’s security. Avoid payments on websites that do not start with ‘HTTPS’ and are not secured.

Sometimes the website looks the same but gets redirected to another platform when making payment. Ensure that you are on the website you researched and not getting to another website while making payment. It is always good to type the complete URL, double-check it, and then enter the website. Avoid clicking on links sent by someone you do not know or have not met in person.

2. Lookalike Mobile Apps

Fake apps in another huge source that scammers use to trick potential investors, and you can download them from Google Playstore and Apple Store just like the original apps. Identifying between the fake and original apps can be very difficult at times. The original app owners often report these apps and get them deleted. Yet thousands of investors have become victims of these fake crypto apps, as reported by Bitcoin news.

These risks are more in the case for Android users, but all the investors should address caution. Read carefully and see any incorrect spellings in the app name. Look for logos and color combinations of the brand, and avoid any apps with inauthentic color schemes. If you have any doubts, do not proceed to download.

3. Email Scamming

It may look like you have received an email from a genuine crypto company. But exercise extra caution before you invest your cryptocurrency. Check the branding and company logo, and make sure that they are original. Try verifying the email address of the sender with the company. This is why we always recommend investing with financial companies that work with real people, whom you can meet. In case of doubts, you can contact someone working there.

A good way to scam is by announcing initial coin offerings (ICOs) to attract the investor’s funds. Be mindful of such offers that you receive in emails or come across while browsing the internet. Spend some time and go through the details. The best way is to check it with the staff of the cryptocurrency company.

4. Pump and Dump Schemes

Pump and dump schemes entail exaggerating a cryptocurrency’s value using misleading or false information, and selling off the inflated assets once the price peaks. Such mechanisms usually focus on rookie investors who hope to reap quick gains.
Beware of investment proposals promising certain returns or huge profits with little/no risk. Do complete research, on any cryptocurrency or investment opportunity before putting in your money. Look out for the red flags like aggressive marketing techniques, glam amounts of claims, or haste to do something quickly. You should be aware of the substantial risks associated with legitimate business investments, there is no guarantee in the digital assets market.

5. Ponzi Schemes & HYIPs

Ponzi schemes and high-yield investment programs (HYIPs) guarantee high returns on investments using the funds from new investors to pay the returns to earlier investors. Such schemes are fuelled by the constant recruitment of new entrants whose subsequent investments help to pay the old participants. They finally collapse on account of a shortage of investments or authoritative interference.

Be wary of investment opportunities that promise unattainable returns or require you to sign up others to benefit. Research the background and the integrity of any investment platform before investing funds. You should seek out the warning signs like complex compensation structures, lack of transparency, and pressure on you to recruit others.

6. Impostor Social Media Accounts

We often discover that the celebrities that we are following on social media are fake users. The same is true with cryptocurrency, where fake, imitating bots are quite widespread. You cannot trust offers that you come across on social media platforms like Facebook and Twitter, particularly when these offers are very lucrative and beyond the usual.

Finally – Cryptocurrency is Volatile, Invest Safely

Investing in cryptocurrency is unpredictable because of its volatile nature. You can see frequent ups and downs and dramatic price swings. Proceed with cryptocurrencies only if you are mentally prepared for this volatile investment.

Digital currency is at boom currently, but keep in mind that it is still very new in the market. Making investments in new concepts that we are not aware of calls for risks and challenges. If you still want to proceed, research thoroughly and make a conservative start.

Fawad Malik

Fawad Malik Technology geek by heart, blogger by passion, and founder of nogentech.org, He regularly explores ideas and ways how advanced technology helps individuals, brands and businesses survive and thrive in this competitive landscape. He tends to share the latest tech news, trends, and updates with the community built around Nogentech.

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