Steemit Crypto Academy |Season 3 week 6 - Crypto Scams and how to avoid them

in SteemitCryptoAcademy3 years ago (edited)

The Crypto world has grown exponentially over the years courtesy of the many exciting income-generating opportunities it offers to many people globally. Many are excitedly joining the Crypto train daily as investors and traders.

However, Cryptocurrency is still an emerging financial system that is not only highly rewarding but also highly risky in terms of volatility in the Crypto Market and the plague of bad actors/scammers/thieves that work 24/7 attacking both the Crypto experts and the newbies in the Crypto space. In this world, wherever there is something profitable, there will always be thieves/scammers who seek to game the system and gain money the easiest way by “scam or fraud” practices.

Crypto scams.png

Background image:Pixabay

It’s so unfortunate that many people have lost their life savings and investments in Cryptocurrency scams after having fallen victim to the various forms of Crypto scams. It’s therefore important for all Crypto enthusiasts to learn about such a risk and plague of Crypto scams so that they can be in a position to invest wisely as they secure their funds in this potential and evolving financial system.

The following are the different forms of Crypto scams with a way to avoid them.

Forms of Crypto scams

Imposter websites/phishing sites

Scammers create fake websites/phishing sites. These nearly look the same as the original exchange websites. These play around with the URL of the original exchange website. For instance, where there is supposed to be a letter (O), they replace it with the digit zero (0). That slight change becomes very hard to notice by the users hence an easy fall in a trap of entering their private credentials (keys and passwords) on a wrong duplicated site ending up losing all their Crypto funds to the scammers behind that phishing site.


Image source:Pixabay

Such phishing sites can be avoided, by users paying close attention to the URL of the Exchange. Exchanges such as Huobi are doing well in keeping their users alert by always reminding them to cross-examine their original exchange URL. Every valid and secure URL should have a small padlock icon at the start of that site link. Invalid and insecure URLs will always be without that small padlock icon. Therefore, a user should take note of that to avoid falling victim to the many Crypto scam phishing sites.

Email scams

Scammers send emails to some targeted users of the original exchange, impersonating and claiming to be sent from the original exchange. Such emails contain phishing links leading to their scam duplicated exchange site. A user ought to cross-examine the information in that email to see whether it’s authentic. If you suspect anything fishy in the email sent to you, immediately contact the online customer support for the exchange to confirm its authenticity.

Fake apps

Users should be aware of fake crypto wallets and Exchange apps running on the Google play store. According to the article over 10,000 people have downloaded fake crypto wallets and exchange apps on the Google play store. These fake apps are created by scammers to take advantage of those with no knowledge of the original official Crypto exchange wallet applications.

Though the Google team labours to delete such fake apps, they eventually pop up again and again. Therefore, people should learn about and download the official exchange wallets from the link provided on the official website of the exchange to avoid falling victim to the many fake apps in the Google play store.


Image source:Pixabay

Social media scams

Scammers sometimes use accounts of popular crypto influencers to lure the public into participating in fake ICOs. You should note that such social media accounts can be hacked by these bad actors which are then used to spread fake crypto-related news directed towards robbing Crypto investors’ funds.

Business/investment opportunity scams

You should be aware of scam Crypto projects that operate on a Ponzi scheme. These make unrealistic promises of high returns to investors by luring them to purchase a particular package or some Crypto tokens. They also package their scam crypto project with job opportunities for investors to lure them to invest money in their System and once the money has been invested in the project, there is no way to withdraw it.

Crypto investors should make enough research on a Crypto project before considering investing in it. The research to be done can be about the general public perception of the project, the filed complaints and how they have resolved them. Is the project powered by Blockchain Technology? Is there a clear/public record of transactions?
Are the tokens listed on any public exchange? Can you withdraw your money when you need it? and how long does it take to withdraw it?

Pump and Dump schemes

Scammers also tend to pump up shit coins to lure investors into buying that coin. Once they have done that successfully, they immediately sell off their coins which eventually crush their price value and walk away with abnormal profits from that coin leaving others with just a bag of low-value shit coins. Avoid participating in such pump and dump schemes by investing in popular Cryptocurrencies like Bitcoin, Ether, and so on.

How to safely invest in Cryptocurrency

Diversify your investment

There are plenty of Cryptocurrencies. Spread your investments in a variety of them. There is a saying “Do not put all your eggs in one basket.” Therefore you should not invest all your money in one particular coin. Instead spread it out in different Cryptocurrency types to minimize the risk of losing all your funds at once on one particular crypto asset.

Be prepared for the high Volatility

Cryptocurrency is highly volatile, you, therefore, have to prepare your mind in handling the pressure and emotions of seeing plenty of sharp swing lows and highs in the Crypto market. The sharp declines should not throw you into panic selling off your assets. That would imply a heavy loss on your investments. You should therefore invest on a long term basis because Crypto is just still in its infancy and the future is a bright one for those that HODL.

Make your research on Exchanges

There are plenty of Exchanges that facilitate the easy buying and selling of Cryptocurrencies. Look out for the secure ones, those offering better exchange and trading services.

Get a secure Crypto wallet

Get yourself an offline hardware wallet. Such wallets are more secure than online Crypto wallets, this is so because they are offline away from any likely compromise by its developers. Decentralized exchange wallets like the Steemit wallet are such an example of highly secure wallets that can be used to hold your Steem, SBD and TRX.

In conclusion, though Crypto scams are almost every where in the Crypto space, these can be avoided by the Crypto investors through the above mentioned ways. Whereever there is something profitable, there will always be scammers who will always try to game the system and that's why its important for everyone to understand such a risk involved and take the necessary precautions to secure their funds.

Homework task

  1. What are Crypto scams?
    Make your research on any Cryptocurrency scam. (Attach a few references to the news surrounding that scam crypto project)
  2. To what extent have Crypto scams affected the Crypto space?
  3. Will regulations in Crypto add value to the Crypto space?

Rules and guidelines

  • Post your homework article in the steemit Crypto Academy
  • Only steemexclusive articles will be curated
  • Your article should range between 600– 1000words.
  • Use an exclusive tag #yohan2on-s3week6 and also tag me @yohan2on so that I can easily find your article.
  • Clearly reference your work in case you have directly borrowed any content from other sources. Otherwise, be original and as creative as possible.
  • Plagiarism and spinning of other users’ articles will not be tolerated in the homework task. Otherwise repeat offenders will be blacklisted and banned from the Crypto Academy.
  • Use only copy-right free images and showcase their source.
  • To participate in this task, you should have a minimum of 250SP and your reputation score should not be less than 55.
  • This homework task runs till 7th/08/2021, Time: 11:59 pm UTC.

Very interesting and informative lecture from you.

I give my entry soon.

Thanks for making like a wonderful lecture to us.

Thanks. I am looking forward to it.

A very important aspect of cryptocurrency. A very prompt lecture. Thanks @yohan2on.

Thanks for the appreciation.

I really love this topic Prof. So simple and easy to research on. It will give us, students, a better exposure to different forms of crypto scams that's exists even though the discrepancies in one can lead to better modification in another.

Thank you Prof.

Thanks for the appreciation and for such a valuable positive feedback on it. Enjoy your research study on crypto scams. I am looking forward to your work.

Dear Professor:@yohan2on I solved the task and task was about to transfer 0.001 steem in any account but i transfer the 0.001 on memo id and when professor checked the task he comment me:

what is the meaning of this. Now Can i perform task in crypto Academy or not . Please tell me. What is this there is no plagrisam or copy paste in my task then why Professor said to me these words. Am I elligible to perform task in the crypto Academy or not?

Greetings professor I hope you will be well.

I want to know something that I was busy in my exams and I had 5500+ SP and it was free as I was not using it due to the exams so I delegated it to someone else and still I have delegated it to other.

As it's my own SP not of anyone or who delegated me. Can I meet the eligibility criteria under this condition or I should undelegate my SP.

Waiting for your kind response and sorry for the inconvenience.

That's okay. You are eligible to participate since it is your SP that you just delegated.

 3 years ago (edited)

Thank you sir. You will soon see my participation here.

Well done Prof. This is a very relevant topic and and a well delivered one.

Please I want to know. Do you mean we should do a research on any form of scam or an example of a situation where someone was scammed in the first question?

Do you mean we should do a research on any form of scam or an example of a situation where someone was scammed in the first question?

Do research on any form of Crypto Scam and go ahead by providing an example of a situation where someone was scammed in that particular Crypto scam. Otherwise, both are needed for a better explanation.

Hope that has made it more clear for you.

Yes! I have paused my work because I was not clear about the questions but now I can continue. You will see my work soonest.


Your article should range between 600– 1000words.

Does it mean that we are not allowed to write more than 1000 words?

You should not make a too lengthy essay. Just be straight to the point and keep your essay at a maximum of 1000 words.

Thanks, professor. Very informatif lesson. But I have to pass it for this week.

Simply explained really enjoyed reading your post

Thanks for the appreciation, I am looking forward to your work.

Yes, very soon

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