Common Types of Cryptocurrency Scams
Cryptocurrency scams are all too common, and you may fall victim to one at any time in your life. There are many different types of Cryptocurrency scams, and you should know what to do if or when it occurs to avoid wasting your time and money. While some Cryptocurrency scams may seem plausible to an individual just starting in the investing world, they may be nothing more than a con. Learn to recognize these scams so that you do not lose your hard-earned money to fraudulent businesses.
One type of Cryptocurrency scam is the “Rug-pulled” scam.
These scams have a couple of different names, including the “Rug-Pull Exchange” and the “Rag-nels”. A rug-pulled or rug-pull exchange involves a person selling a quantity of one kind of Cryptocurrency for another kind of Cryptocurrency, usually to receive a high amount of commissions. The problem with these is that they typically only work for short periods of time. This can result in someone who has a large number of coins coming off their hands not have enough time to sell their tokens before the market turns bearish and they’re forced to sell at a lower price.
Another type of Cryptocurrency scam is the “Crypto-hedge” scam.
Basically, a person will set up an investment opportunity to get a small percentage of the profits from a major selling point for a long time. For instance, a person may have bought a lot of ether for the spring of 2021 but won’t be able to get most, if any, of that money back until the end of next summer. They’ll then turn around and sell those ether since they’ll have secured a little bit of a profit. cryptocurrency scams fall under this category because, to receive any money, an investor must buy at a very inflated price so they can turn around and resell at a lower price.
Finally, the last type of Cryptocurrency scam is the “Dirt Cheap”
Cryptocurrency scam. These are usually set up by newcomers to the market who do not understand how pricing is done within the field of Cryptocurrency itself. Basically, these people will offer individuals losing money on certain coins as an investment opportunity, but when they realize there are actually better currencies out there, they’ll try to take their money and run.
The bottom line
is that you should research the market yourself first if you’re considering investing in Cryptocurrency. If you see a product that looks too good to be true, it probably is. It’s very important to always have your own goals and ideas in mind as well as what you’re looking to get out of your investment. However, there are many people out there who are passionate about bitcoins and want to help new investors with their investment and knowledge, so there are plenty of such people out there to get help from.
If you’re currently invested in Cryptocurrency
the best thing you can do is invest in something with a low percentage of volume. This means that few people are trying to pull off fraudulent activity in the marketplace, which makes for a safer investment overall. If you’re not sure whether or not you should be trading in Cryptocurrency, it’s probably best to stick with traditional stocks until the novelty of Cryptocurrency wears off. After all, even the greatest experts in cytotechnology aren’t experts at everything all of the time.