CoinMarketCap’s data shows that there are thousands of different digital currencies available today. Despite offering a variety of services, some of these might be crypto scams.
If you’re relatively unfamiliar with the sector, you may have asked yourself, “Is this a genuine project or just another rip-off?” Fear not, this article will give you five real ways to avoid fraudulent crypto projects.
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Scam Coins: What Are They?
Have you ever heard about someone who tried to invest in cryptocurrency but was scammed out of their money? Perhaps those unlucky users chose an asset that seemed superior to legit cryptocurrency, or they wanted to find a quick and easy way to get rich without researching what they were doing.
But what is a scam coin in the first place? A scam coin or “shit coin” is a fake cryptocurrency coin or token that has no long-term value. As part of this cryptocurrency scam, a potential investor purchases an unverified and unknown coin that is extremely valuable – or so is the investor told. These fake projects have been pulling off exit scams for years, which is why you should always do thorough research before investing.
Cases of Crypto Scams
In recent years, there have been several high-profile crypto scams. Here are three of the most well-known:
OneCoin
Ruja Ignatova started OneCoin in 2014. Back then nobody could have predicted that this project, posing as a cryptocurrency, was yet another Ponzi scheme. Thanks to attractive marketing, Ignatova convinced people all over the world to buy OneCoin tokens, telling them they would gain wealth and be part of something big. Sadly, that “something big” turned out to be a massive crypto scam, making OneCoin one of the most high-profile fake schemes in the world.
Bitconnect
BitConnect was supposed to be an open-source cryptocurrency. In the same manner as many other frauds (whether they are connected with cryptocurrencies or not), Bitconnect claimed to offer returns of up to 10% (which is huge), and despite the fact that the coin used in the scam was legitimate, the organization encircling it was nothing but a scam.
Squid Coins
Squid coin, a not-so-successful cryptocurrency, was released with the intention of scamming its investors. Taking advantage of the similarity to the Netflix Squid Games series, the scammers managed to pull the wool over many people’s eyes. Beginning at less than a penny, the price skyrocketed up to $2860 within a short span of time; only for it all to come crashing down as soon as the developers decided to cash out.
Crypto Scams: How to Spot and Avoid Them
Let’s discuss some scam coin characteristics to help you save a lot of time and money by avoiding possible fraudsters. Here’s how you can spot a scam coin:
Identify Communities that Interest You
Since a legit crypto project always prioritizes putting all the essential information online, keep an eye out for any concerns regarding the platform’s legitimacy, background, or reports from other users. Check out the coin’s website and social media pages on Facebook, Twitter, Reddit, and YouTube to see what the community has to say about it.
Study the Whitepaper
There is a whitepaper for every legit token, so look for the one that the token you’re researching has. Whitepapers give you a lot of information about the coin. If there is no whitepaper, the coin could be a scam.
Use Correct URLs
Make sure the website does not redirect you to a scam-like address. Always check the correctness of the URL you’re using.
Don’t Fall for Unrealistic, Risk-Free Promises
Scam coins make exaggerated promises of massive, risk-free returns as soon as possible. The offers are simply too good to be true.
Keep Your Wallet Secure
Be sure to keep your wallet and secret phrase safe at all times. Anyone who knows a wallet’s secret phrase has access to everything within it; therefore, you should never reveal it to anyone. It is also recommended to store your coins in more than one wallet to avoid losing them.
What is the Best Place to Find Legit Cryptocurrency?
First things first, you should search legit cryptocurrencies on CoinMarketCap – a reference website and tool that provides information on cryptocurrency price, charts, volume, and other data. It’s the place where you’ll find everything from top currencies to altcoins, memecoins, and all sorts of recently launched projects. Another good place to find genuine currencies is Swapzone. On our website, we only list legitimate cryptos, reviewed by CoinMarketCap.
How to Exchange Legit Cryptocurrency Without Being Scammed?
To exchange cryptocurrency, you also need to find a legit exchange provider, and Swapzone is here to help. Swapzone is a real crypto exchange aggregator. The claim is supported by hundreds of genuine reviews and positive user experiences.
Follow these easy steps to convert crypto or send your assets in the secure wallet via Swapzone:
- Go to Swapzone’s official website.
- Select the pairing you wish to exchange. For example, BTC to XMR.
- Enter the amount of BTC you wish to exchange for the other crypto. Swapzone will bring you the best rates from 17+ popular and legit exchanges and display the number of coins you will receive.
- Click the “Exchange” button, and type the address you want your new tokens sent to in the fields.
- When you click on the “Proceed with the Exchange” button, Swapzone will show you the reviews of the exchange you choose.
- Wait until the deposit is processed by the exchange and the trade is complete. Review and rate the exchange partner if you wish.