Are you planning on investing in cryptocurrency? Crypto investment has huge growth potential, with the value of most cryptocurrencies increasing daily. As a cryptocurrency investor, you also control your funds and transactions, making it a safe investment.
Besides, transacting business using cryptocurrency is easy and offers more confidentiality. However, cryptocurrency transactions are irreversible. When you send cryptocurrency to another party, you cannot stop it.
This has contributed to an increase in the number of crypto scams. Some of the scams are simple and obvious, while others are sophisticated and difficult to determine.
If you fall into the hands of crypto scammers, you might lose all your investment, and your private data will be in jeopardy. However, despite the huge number of crypto scams, you can take measures to avoid being a victim of crypto scams.
So, do you want to know some of the effective measures you can take to avoid falling for a crypto scam? If so, you are in the right place.
Here are tips on how to avoid falling for a crypto scam
Types of Crypto Scams
To successfully avoid falling for cryptocurrency scams, it’s essential you first understand the type of crypt scams that exist.
Impersonation Scams
These are scams where fraudsters take advantage of less tech-savvy individuals. They promise to assist individuals who want to trade in cryptocurrency with account opening.
They first ask you to provide them with KYC documents to complete account verification. Once the account is opened, the fraudster informs you the account is ready to go.
However, after opening the cryptocurrency account, the fraudsters still retain full access to your account. Once you deposit funds the account, they quickly swap them for withdrawal in their own accounts.
Giveaway Scam
The scammer promises to offer you free cryptocurrency as part of a giveaway project. They will request you to do wallet verification by transferring some cryptocurrency to an address offered by them.
Giveaway scams are mainly dominant in social media platforms such as Twitter. Fraudsters use fake accounts under the name of celebrities and popular crypto companies to scam victims.
In some cases, scammers might hack the official accounts of celebrities to perpetuate the giveaway scams.
Employment Scam
This is where scammers impersonate recruiters by offering fake job offers. They take advantage of job hunters by acquiring their private information in such cases.
They may also ask the job seekers to make payment in cryptocurrencies to receive training and other job-related materials. In most cases, the job offers have appealing terms to easily attract the attention of job seekers.
If you fall in the hands of such scammers, you will pay to get trained; however, no job will be coming your way.
Phishing Scam
These are the most common crypto scams. In a phishing scam, fraudsters apply phishing techniques to access people’s accounts.
Phishing scams usually come in different forms. The most common is where victims are tricked into visiting a website that appears to be legitimate.
Such a site could be a wallet or any other cryptocurrency that will request the victim to insert their private information. As you put in your login details in such phishing sites, the scammer will receive your logins from their end.
They will then use the login details to access your real account. From there, they can transfer your cryptocurrency to their own accounts.
Telegram Scam
Telegram has become a hot spot where most victims are falling into the hands of crypto scammers. All the discussed types of scams mainly take place in telegram.
Telegram makes it easy for scammers to contact target victims directly and discretely. In most cases, the scammers posses as tech support team or impersonate major crypto exchange companies.
If you believe them they then guide you on what to do. From here they can work their way to gaining log in details to your crypto wallet.
How to Avoid Falling For a Crypto Scam
Now that you know the various types of crypto scams that exist, you should learn how to avoid them.
Do your Research
Before investing in cryptocurrencies, it’s paramount you do research. Most people only focus on investing in the most lucrative cryptocurrencies but ignore crypto scamming.
There is a tone on information available online from experienced traders and billionaires. Such information can guide you on how to trade cryptocurrency and avoid scams.
Ensure to go through such kind of information before investing in cryptocurrency.
Don’t Trust Everyone
Cryptocurrency transactions, when completed, cannot be reversed. Hence you must be cautious when a person directly contacts you asking for payment in cryptocurrency.
If the person uses emails that appear to be from government officials or celebrities, you should be concerned.
Secure Your Crypto Wallet
Ensuring your crypto wallet is protected using a strong password is essential for keeping scammers at bay.
Ensure to use a password that is easy to remember and hard for others to guess. It should also have a combination of letters and numbers.
After securing your wallet, you must not share your private key or phrase with a third party. It’s better to have such information offline.
Use a Multi-Factor Authentication
In some cases, hackers can easily bypass your crypto wallet password. But if you have multi-factor authentication, the hackers might find it hard to navigate through.
Even though multi-factor is not a sure-fire solution against scammers, it gives you a chance to fight back.
Check That URL
Scammers can send you a crypto URL that appears legitimate. If you log in to such a URL, the scammers will gain your login details to your real account.
Thus, before visiting any URL, you must be cautious. In most cases, scammers usually switch numbers and letters of real URLs to make theirs appear legitimate.
You can note such alterations on the original URL if you are keen enough.
Reject Free Offers
Chances are, you will come across crypto offers that require you to make an upfront payment. Such offers are usually fake. The scammers behind such offers aim to acquire login details to your crypto wallet.
Thus, always reject any crypto offers that require you to make an upfront payment using cryptocurrencies.
Pay Attention to the Emails You Receive
Even if the email you find in your inbox appears legitimate, you should be cautious before investing in cryptocurrency. You should ensure the logo and branding indicated on the email are the same as on the site.
Besides, if the offer indicated in the mail appears too good, you should be concerned. Scammers have the habit of announcing initial coin offerings to steal your funds.
Avoid Fake Job Offers
Desperate job hunters are usually an easy target for crypto scammers. Such scammers usually make enticing job offers to attract the attention of job seekers.
When job seekers establish contact with scammers, they are requested to make a payment in cryptocurrency. This is to make them eligible to receive training and other job-related materials.
Avoid them if you come across such job offers that appear too good to trust.
Avoid Fake Mobile Apps
Due to the increased demand for mobile apps, most scammers are taking this opportunity to scam investors. They are coming up with fake apps where some of them make their way into Google Play and Apple App.
If you download a fake cryptocurrency app, you will likely lose your login details to such scammers. They can then use your login details to wipe your real cryptocurrency wallet clean.
Thus, before downloading a cryptocurrency app, assess its authenticity. Check for obvious misspelling on the name of the app. Evaluate whether the branding looks authentic and whether the correct logo is used.
If you find something amiss in the spelling of the app, logo, or theme color, avoid the app.
Avoid Crypto Websites Promising To Offer Unrealistic Returns
You might come across sites promising to multiply your returns when doing crypto trading. Most of these sites are scams.
If you deposit your cryptocurrency on such sites, you might never access your balance ever again. Thus, before choosing a crypto platform, ensure to do some research. Ensure to read online reviews to find whether there are any complaints made about the site.
You can also visit consumer protection sites and determine whether the crypto website you want to invest in has been red-flagged.
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Avoid Becoming a Victim of Crypto Scammers
Cryptocurrency investment is a long-term investment with a huge potential for appreciation. However, to benefit from the crypto investment, you must avoid becoming a victim of a crypto scam.
But if you don’t know the types of crypto scams that exist and how to avoid them, you might end up being scammed.
Read the above tips on avoiding falling for crypto scammers and get it right.
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