Steemit Crypto Academy |Season 3 week 6 - Crypto Scams and how to avoid them For yohan2on
INTRODUCTION
The word scam is mostly used to express any fraudulent activity that takes place mostly goods from a person unaware. In our present world, today with a lot of technologies and internet scams has been increasing. It is difficult to stop scams since money is still in circulation so it is better to be careful when dealing with anything that concerns money online.
Cryptocurrency has developed to be something profitable in the present world so there must be those who will want to attack it to gain money which they believe is the more efficient way to make cool cash.
A cryptocurrency scam is where investors are attacked by criminals tricking them to believe that it's a get-rich-quick scheme that is in all actuality a Ponzi trick. Another mainstream technique used by these scammers is that they set up an exchange to take investors' money, which at a point cant be withdrawn by the investors after investing.
Cryptocurrency scam has dealt with so many people as they have lost all their money to the online scammers which have brought them back to square one. A cryptocurrency scam is also a process where someone or a group of individuals will fake personalities telling their targets that they can help them earn money daily and to achieve that you have to invest it in cryptocurrency with them.
There are numerous ways scammers operate to get and deceive people and if you are not careful you will be victimized. Some of these ways include
- impersonation
- social media scam
- fake app
- phishing sites etc.
I will explain some of these ways to my understanding of how it's been used to scam people.
The impersonation, for example, creates an exchange not different from the real one so they attack investors who might have had issues with this exchange. The scammers go to the real exchange comment section to see the complaint of investors. We're some make a complaint like " I CANT WITHDRAW MY COIN PLEASE HELP ME, DEPOSIT ISSUE.
So these scammers email those investors and tell them that their complaint has been received and will be solved immediately asking them to send their private keys for them to fix it without the knowledge of these investors to know that they are scammers so when the key is sent they transfer all the investor asset to their wallet and block them.
PHISHING SITE: they send links to people attaching it with a fake story about cryptocurrency once you click that link they have programmed it to ask for your private keys and when you insert it they capture it login to your wallet and steal your asset.
Also, take note that there is something called auction fraud they create a page on Facebook to sell products online once you click any of the products you like it takes you straight to their inbox and immediately they start a conversation with you.
HOW TO DETECT SCAMS IN AUCTION SELL
they tell you they accept any cryptocurrency if you can't make the transfer to their local currency.
they will never accept payment on the delivery day rather they will twist you to pay before they deliver it to you.
From the above chart, the seller is persuading me to make at least half the payment before the delivery, I insisted on payment on delivery they refused This is an example of auction fraud.
firstly, they will tell you to pay with crypto since it's well known to them that crypto is Anonymous, and the transaction made here can't be traced.
secondly, they will promise you big money as a profit once you invest a certain amount of money
In the above screenshot, the claimed manager promised the investor to earn an extra $2,000 just in 12hours with an investment of $200.
- Also, the time frame. They have used a short time and big profit to deceive people in the crypto space.
Make your research on any Cryptocurrency scam. (Attach a few references to the news
I made research and in my research, I found out that there is a form of cryptocurrency scam known as CELEBRITY ENDORSEMENT CRYPTOCURRENCY SCAM.
Scammers are now using celebrities to create an advert promoting their cryptocurrency investment platform. This advert is usually about their website looking legit so they talk to people buy some investment package with cryptocurrency in other to earn a huge profit. You see the advert that it's a celebrity that is advertising it you won't think it's it's legit.
NEWS ATTACHED TO THIS CELEBRITY ENDORSEMENT CRYPTO SCAM
According to the vanguard newspaper, there is a comedian with the stage name as pankeeroy he was arrested by efcc as a result of internet fraud. And the reporter said that about #22,300,00 worth of bitcoin was discovered in his account.
The news also stated that the comedian went into a bitcoin scam after suffering depression using a particular website to defraud his unsuspecting victims. This is a clear example of a celebrity scam.
TO WHAT EXTENT HAVE CRYPTO SCAMS AFFECTED THE CRYPTO SPACE.
Crypto scam has affected the crypto space so much to an extent it leading to banning in some countries like Nigeria, China, Vietnam, Columbia. Etc. Since the majority of countries have started banning cryptocurrency and exchange by restricting users the price of the cryptocurrency has dropped.
According to the Chinese government, it's is banned in China because of its potential use for money laundering and illegal dealings.
It's has affected institutions and many businesses, for instance, the ban on exchange in some countries have reduced the number of investors and also reduce the source of income for the owners as they get profit when users exchange their asset for local currencies.
- Will regulations in Crypto add value to the Crypto space?
Crypto regulation can add good and also bad value to the crypto space let look at the bad aspect first if cryptocurrency is regulated by the government they will want to impose a tax on all crypto holders. Also, the beauty of anonymity will be destroyed as financial institutions will want to monitor all transactions too.
The good aspect. If cryptocurrency is regulated it could make the market less allowing people to manipulate others and run this could increase the value of cryptocurrencies.
In conclusion, whether regulation or not the cryptocurrency market will be uncontrollable speculative, and investors who want to enter into the crypto space ought to painstakingly think about the risk and consider their investment goals before entering a cryptocurrency position.
Thanks so much for reading through my article. It was a nice and educative lesson by the processor @yohan2on.
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