Crypto Academy / Season 3 / Week 6 - Homework Post for [@yohan2on] // CRYPTOCURRENCY SCAM

Hello Crypto Prof @yohan2on !

I am much delighted to be part of this weeks cryptocurrency homework task , infact i read through the post made by @yohn2on and i appreciate what ever inpact kept together to bring out this lesson.
below is my homework task for the week :

What are Crypto scams?
Make your research on any Cryptocurrency scam

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Starting this question I will have to share my first scam experience in cryptocurrency, back in 2018 when I first came to the university I was very desperate looking for ways to make money so I had a friend who was doing what we all call in Ghana as “ONLINE BUSINESS” , I decided to join him and the requirement for joining involve investing money and buying a crypto coin ( Bitcoin) then hold it for a number of days to have your investment back in a triple fold , for Invested GHC 1000 expecting GHC3000 at the end of each week after the first week I requested for a first withdraw of my investment and the site told me the wallet I am using is not matching with the system so I have either deposit any amount in my BTC wallet and transfer that amount to the site before the system can be compatible , as a new blood in the crypto industry I did that and in fact till date my money is still locked up there , this made me loose trust in the cryptocurrency world until I met my good friends @njaywan who expose me to the right channel again and here I am .

WHAT EXACTLY IS CRYPTO SCAMS

Today in our world people adopt very dubious means to amass wealth, in the cryptocurrency world individuals are really making good success there same time others are also waiting to steal the hard work earning of the successful ones.
Today coins such as BTC, ETH, and BNB are booming so and traders who are well focused and smart are making good earnings but due to the fact that some individuals are much interested in getting rich quickly is exposing many traders to scams.
In a simple definition I will say crypto scam is the use of smart dubious means to steal or take away investors long term earning within a jiffy, this is successful when scammers or hackers convince a trader to have access to their wallets, private keys, or seeded phrases.
In the industry we say something which is “YOUR KEY IS YOUR MONEY, so it is advisable to keep them such a way that thieves don’t get hold of it.

There are various means by which these scammers that dupe people can be apprehended, i will like to highlight some of them below;

• When A site or a cryptocurrency platform is guaranteeing you of making more profit

• Scammers will always want to give you return that are impossible in the crypto world to guaranteed

• These scammer always make proof less claim, so as a trader I hope you are interested in how the system is working with your money as well.

NOW LET LOOK AT THE TYPE OF CRYPTOCURRENCY SCAMS

• BLACKMAILS ( THREATHENING EMAIL ) : One thing common among Ghanaians this days is blackmailing , scammers will send you an email telling you some nudes they got which is of you and they demand a ransomed before they delete it completely if not they will expose your nudes , now they do not like to take money physically so they request for you to send them a cryptocurrency we all know this is immutable and you can’t trace them as well , on the other you can also be sent a phishing email as a form of invitation from a site you might know or not , once you click them and enter your details they are done with you.

• SHAM WEBSITE: This are website created to be imposters of site you are familiar with, usually what this scammers do is to create website similar to what you know or maybe don’t know they look professional as well, once you click on the link it might be program to be redirected to the phishing site where you are going to be scammed. It is good you check carefully all URL you are using because the slightest mistake you make can lead you to such website , mostly we are advise to look for a pad lock symbol close to the Url before trusting a site , with me I will advise all traders not to give their private keys to unknown site.

• SOCIAL MEDIA SCAM : There are a whole lot of whales today in the cryptocurrency industry this makes them celebrities so they always use their actions to direct any one that follows them , there are also BOTS in the system that are set up to have large social media reputation just go scam people , let say a celebrity you are following advise you to buy an ICO and you have been following him for days you will end up doing and if that was a scam they will definitely get you because you entered blindly by the directive of the whale celebrity who is a BOT. Do not trust offers on the social media today, don’t agreed to send crypto to someone you meet on social media without investigation.

• ICO SCAMS : Initial Coin offering is way in which new cryptocurrency coins are promoted to gain value in the market , let say I create a coin today to make people invest more into it I deliver an initial price that is very affordable to everyone , once they buy more the coin get values. In doing so scammers have also started creating fake coin to use the ICO system to take away investors’ money , usually they so not present a white paper which is a way you can spot fake ICO , once they are able to sell the coin to you and they receive the payment you will be expecting the ICO to trend bullish to give you more income before you realise you will be a bug holder.

THE SOUTH AFRICA CRYPTOCURRENCY SCAM

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South Africa is one of the country popular this year when it comes to cryptocurrency scam, the country lost over $4 billion invested by traders in two scam deal this year.
Let talk about one of the scam that is recognise as the world most biggest scam ever involving a company called Mirror Trading International who brought the investment plan of Africrypt, this company offered their investors a profit return of 10 % on their investment this lead many investors to invest in it, the sum total of investment made by $170 million.
After a couple of works done by the company in April the founders run away with about $3.8 million BTC worth investors’ money , the investors where sent emails that the companies system was hacked.
Investors decided to take the case to court, it was reported on Bloomberg that investors are crying that they cannot find the brothers who introduce Africrypt to them anymore.
Upon investigation this was the report Africrypt made to Bloomberg:

Earlier this month, Africrypt’s lawyers told Bloomberg that the founders had terminated their contract as well. “Our mandate to assist the Cajee Brothers has been terminated,” the attorney, John Oosthuizen, said when asked about the Raees and Ameer Cajee’s whereabouts.

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To what extent have Crypto scams affected the Crypto space?

Cryptocurrency in some locality especially Ghana Scamming has affected the credibility of the industry, today most people do have the feeling that if they adopt the cryptocurrency in their businesses, let look at some key points where the industry has been affected the most.

• Cryptocurrency traders lost their credibility due to the rise of scam and fraud, the moment you begin a conversation with someone and you bring in crypto they look at you as a scammer or someone who is illicit because they think you have thrown away your money.

• Due to the scam alert countries like mine Ghana do not regards cryptocurrency as a legit financial source , there was a declaration made by the bank of Ghana stating that constitutionally Cryptocurrency is illegal see the post below : 
  

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• Reduction of potential Investors in the cryptocurrency industry, there are a whole lot of business men out there who can multiply their wealth if they should invest, but due to the scam feud they don’t have much trust, like the recent case in South Africa where the Africrypt brothers took away whooping sum of $3.6 million worth of BTC, after the news break a whole lot of investors regretted ever investing in the cryptocurrency.

Finally I will say the rising of cryptocurrency scam has caused so much problems in the industry as well.

Will regulations in Crypto add value to the Crypto space?

Although the cryptocurrency industry is decentralized and not controlled by any organization it won’t be bad setting up regulations to oversee how fraud and scam are becoming rampant in the industry.

• First and foremost let look at the how confidence an investor will be when they know what they are going into is secured by some authorities such that they can’t be dupe easily.

• With regulation people cannot just decide to bring up ICO’s just like that because there will be some criteria they must achieve before they can do so, this will provide some insurance to all investors, like the Bank Of Ghana does every Bank in the country is require to deposit some amount to the BOG before they can function, in case there is a problem the money deposited at BOG can be used to settle all investors.

• Regulations will help give more values to the coins in the crypto industry because more investors will come on board to invest and the bad news about crypto out there will be limited because more people will begin to admire it.

In conclusion I will like to thank crypto prof @yohan2on for exposing us this week to a lesson related to scam in the cryptocurrency, in fact after researching during the assignment I have learnt a lot and I will share this with any new member or someone out of the market to have trust in the industry and how they can be safe from scams and enjoy the industry.
Finally let me thank the entire Steemit team for helping us each week to acquire more knowledge.

THANK YOU