Crypto Academy / Season 3 / Week 6 - Homework Post for @yohan2on
WHAT IS CRYPTO SCAMS?
Scam is as old as man. As it is believed by bible scholar's that life started from the garden of Eden where God created the male and female. And handed over everything He created under the control of man and God blessed man to be fruitful and multiple. Now satan seeing all this scammed or tricked man of all the wealth God bottled on him(man) through serpent.
This is the type of investment or act which involves criminal stealing of money from crypto investors and traders with the use of creating deceitful impression of some crypto tokens and giveaway. Because of the rapid growth of cryptocurrency and it's profit to investors and traders it has attracted a lot of scammers and fraudster.
Crypto scams is not a 2020 or 2021 thing but is as old as bitcoin been the first crypto coin. Right from the creation of bitcoin which is the first cryptocurrency scammers have been is just that is becoming more and more. But the funny part of this is as cryptocurrency grows so scammers.
Today there are a lot of scheme and forms scammers use in stealing the money of the people. Below are the following forms or types of scams.
Exchange and Wallet Hackers
As it is known that hackers or scammers knows that it is in exchange platform lies the wealth of crypto and that it is in online wallet all crypto assets are saved. Today scammers are not just concentrating on exchange only but also on online wallet.
The references below are the cryptocurrency exchange and wallet hacked.
Phishing Cryptocurrency Scam
In this type of Scam the scammer will use a popular tools to contact the investor'(s) or give them a false email requiring the account details or information of their account and providing space where the account details will be typed in and then, granting them access to the investor's account where they move all cryptocurrency to another account.
Some also ask for private keys from the investors, informing them that their account needs to be secured and all this is to steal their Cryptocurrency. And immediately this is achieved they stop every communication with the investor.
ICO scam or Exit scam
The ICO means Initial Coin Offering. This very one a whole lot of people have fallen victim of this especially the newbies.
Here the scammer creates a crypto coin promising the crypto-world and the people that it will be a future and after the people may have invest the scammer flies into the air with the funds of the investors.
In some cases the scammer creates a group for a particular crypto coin and ask the people to drop their private keys inorder to receive a giveaway coin. You can call it airdrop. All is just to draw attention of investors and immediately they get the targeted money that marks the end of that crypto coin.
Social Media Scam
This is when scammer creates a fake social media account(s) to replicate a particular Cryptocurrency inorder to get followers and their account details. And after that hacks the account.
In some cases a fake social media account is created with a name of a celebrity or they hack an account of a celebrity inorder to receive money from the followers.
HOW IT HAVE AFFECTED CRYPTO WORLD
TO WHAT EXTENT HAVE CRYPTO SCAMS AFFECTED THE CRYPTO SPACE?
Indeed the Crypto scams have affected the Crypto world and have even caurse some damages on the live of the investors.
The following are caused by crypto scam:
Restrictions or Banned:
Because of the effect of crypto scam some organizations and families have restricted or banned their members and children from investing or involving in Crypto trading despite the massive profits from it. Today in Nigeria banks don't accept any transaction of Cryptocurrency because of the anncement made CBN some months ago.
Because of how crypto scammers have abused it and they are everywhere in the market platforms, it has affected the crypto ecosystem and made some people believe that crypto is about scamming. Because of crypto scammers police in some country harasses Crypto traders.
Fear of investing:
Because of the effect of scammers in cryptocurrency it have created fear in the minds of the people especially the newbies. And it has scared investors away from investing in cryptocurrency.
Regulations in Crypto
WILL REGULATIONS IN CRYPTO ADD VALUE TO THE CRYPTO SPACE?
Every organization needs regulations inorder to work consistently, orderly and properly in every society or system. Regulation today in the world system at large have stable everything to some extent.
The following are or will be the result of regulating crypto:
🔸So, regulation in crypto will help trading move smoothly and orderly.
🔸Regulation in crypto will allow some financial bodies or institution like world bank to regulate cryptocurrency.
🔸It makes the crypto market a better place for investing by stabilizing it.
🔸It also regulates the buying and selling of cryptocurrency by not letting the seller to release coin without receiving any credit alert from the bank through P2P trading.
As it was said earlier that where there is profits there will be scammers and fraudulent activities. So the more crypto grows the more scammers. But this topic is to create awareness among the investors and newbies that there are scammers and fraudulent activity in the market and they people should be extremely careful.
No matter what the organization will do they can't stop fraudulent activities but they can reduce it's activities.
My advice to every trader, investors and newbies is that you are not allowed to release your private keys to anyone for any reason.
Thanks for reading my post.