5 Crypto Scams Investors Should Watch Out For


Cryptocurrency is one of the most exciting investment opportunities available today. Unfortunately, like any other emerging market, it comes with its fair share of risks. Many fraudsters have started crypto scams to take advantage of eager investors.

New crypto businesses open every day, and with them, new cryptocurrency scams appear. You can’t expect to stay ahead of all fraudulent activity, but you can learn to recognize common signs. Here are five types of crypto scams you should watch out for and how to spot them.

1. Fraudulent Initial Coin Offerings

When a new cryptocurrency launches, they often provide an initial coin offering (ICO), like an IPO in a traditional startup. This exchange presents an ideal opportunity for fraudsters, who offer fake ICOs and take investors’ money without delivering the promised tokens. Thankfully, you can confirm whether a new cryptocurrency is legitimate in a few different ways.

First, look up the project’s members on sites like LinkedIn. If you can’t find their profiles, they seem inactive or their history doesn’t add up, then the project is likely fraudulent. Companies that don’t offer whitepapers are also usually untrustworthy.

2. Fake Crypto Investment Websites

You may choose to avoid investing in new cryptocurrencies, but some crypto scams target users of more established currencies. Many websites seem to offer an investment opportunity involving currencies like Bitcoin and Ethereum. These ask for a small crypto payment in exchange for substantial returns but don’t deliver on their end.

Before investing in any site, ask a crypto forum about it to see if anyone can confirm its legitimacy. If the site claims to have ties to a reliable third party like CoinDesk, ask that third party about it. If nothing else, remember that if a deal seems too good to be true, it probably is.

3. Email Scams

Emails offering attractive opportunities are a common type of scam, and they’ve made their way into the crypto space. Like website scams, these typically promise a substantial return on investment for a small payment. Unlike many fake websites, though, these emails often look like they’re from real, legitimate sources.

If you get a suspicious email claiming to be from a real authority like Coinbase or Binance, scrutinize it closely. Look for typos or any discrepancies in addresses or websites between the email and the source it claims to represent. Most importantly, never send money through a link you get in an email.

4. Malicious Crypto Apps

Crypto and mobile technologies seem to fit together naturally, and scammers take advantage of that. Many apps claim to be crypto exchanges or peer-to-peer lending apps but will steal from you or install malware instead. Since users tend to trust app stores, more than 10,000 people have downloaded these apps.

App store vetting processes don’t catch everything, so you can’t trust an app just because it’s on the official store. Look at the reviews of an app before downloading it and avoid anything with low ratings. Typos and off-looking “official” logos are also frequent signs of a fake.

5. Social Media Hacks

In July, many high-profile Twitter accounts asked followers to send cryptocurrency to an address to receive double the amount in return. Many users gave away their money willingly because these messages came from the real Twitter accounts of real celebrities. It turned out, though, that someone had hacked into their profiles.

Remember that no person or company is immune to a hack. If you see a message from a legitimate source that seems uncharacteristic, it may be fake. It’s better to be safe than sorry, so never send money through a link on social media, even if it’s from a trusted source.

Stay Aware of Crypto Scams to Stay Safe

There are countless crypto scams out there, but you don’t need to know them all. If you can recognize the common warning signs of a scam, you can stay safe. Any investment opportunity involves some risk, but these suspicious situations are not risks worth taking.

Learn to spot these scams so you can protect your hard-earned money. When you know about the common red flags, you can get involved with crypto without fear.

About EmergingGrowth.com

EmergingGrowth.com is a leading independent small cap media portal with an extensive history of providing unparalleled content for the Emerging Growth markets and companies. Through its evolution, EmergingGrowth.com found a niche in identifying companies that can be overlooked by the markets due to, among other reasons, trading price or market capitalization. We look for strong management, innovation, strategy, execution, and the overall potential for long- term growth. Aside from being a trusted resource for the Emerging Growth info-seekers, we are well known for discovering undervalued companies and bringing them to the attention of the investment community. Through our parent Company, we also have the ability to facilitate road shows to present your products and services to the most influential investment banks in the space.

This article was written by a guest contributor and solely reflects his/her opinions.  All information contained herein as well as on the EmergingGrowth.com website is obtained from sources believed to be reliable but not guaranteed to be accurate or all-inclusive. The statements in this article are not that of,  nor have they been verified by, or are the opinion of, EmergingGrowth.com. All material is for informational purposes only, and should not be construed as an offer or solicitation to buy or sell securities. The information includes certain forward-looking statements, which may be affected by unforeseen circumstances and / or certain risks. Please consult an investment professional before investing in anything viewed within.