Crypto Shillings | A trap for the investors
Do you wanna invest in crypto?
Wait..
There are some traps like shillings. These traps may grasp your investment at all. Today I am going to point out one of the biggest cryptocurrency traps for investors and owners.
What is Shilling?
Historically shilling was the name of a British coin, formerly used in the UK and other British Commonwealth countries in the 17th and 18th centuries.
Literally, the word 'shill' means 'stooge'. It is used as a popular term in casinos. If there are not enough players in the casino, the gambler keeps the game playing on. This trick is known as Shilling.
Let us see, how this trick be applied in the crypto world?
Crypto shilling refers to promotional attempts for a cryptocurrency or a project before it ends in a rug pull. It is promoted by influential people or groups who generally get paid for advertising the crypto.
This trap may be summarised as:
Signing the contract with a public figure > He advertises the project > Public interest increases > A hype is created around the project > More people invest in the project > Demand for the virtual asset rises sharply > Price increases > The developers abandon the project > Run away with the investors' funds.
Image Source : here
Why shilling is hateful?
However, any advertising is not a hateful strategy at all. But the major trap of shilling is the inner intention of grasping all investment by shutting down the project.
It may be explained with an example of the stock market. Sometimes the gambler creates hype about some stock share that actually has no real value. People are influenced by the campaign and increased the price of the share. The gambler collect money from the financial market and escaped.
Examples of Shilling:
A watchdog for advertisement, Truth in Advertising (TINA.org), identified 19 influential people who endorsed NFTs having no clear affiliation with the projects.
What to do?
Genuine promoters must ensure that they will exist in the market in the long run. They show transparency and avoid arrogant advertisements. Investors should be confirmed about the affiliation of the promoters with the projects. If the intention of the promoter is not clear, they need to be conscious before investing.
Post reference
~ Regards,
VEIGO (Community Mod)
The shilling concept is getting rampant in the NFT space, a lot of people have used this method to shill NFTs and rug-pull to defraud investors
I still believe NFTs still has many use-cases all over though most of the time they are wrongly used as you've shared for rug pulls to scam people and other stuff. NFT space has long way to go but need a proper guidance.
Exactly...
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