How Can You Find Out That a Cryptocurrency Is a Fraud

scam cryptocurrency

When you look at the cryptocurrency market, you see a promising future ahead. There was a time when people thought only skeptically about this particular market. Things have changed quite a bit in recent years. Today, you have many banks, money transfer services, retail stores, etc. that are accepting cryptocurrencies. More importantly, you have names like Facebook jumping onto the bandwagon to create their own cryptocurrencies. It shows that the blockchain and cryptocurrencies definitely have a future. When you invest in this market, you are not shooting an arrow in the dark.

However, as new cryptocurrencies continue to come, you have to keep track of the fake ones as well. Since millions of people are interested in trading cryptocurrencies and making money from those trades, a lot of frauds have also emerged in this market. The worst scam is when the cryptocurrency you are looking at is itself a scam. How can you know that the cryptocurrency you are about to invest in is not a scam? Here are some telltale signs you can find out in Neuercapitalscam

 

Signs That a Cryptocurrency Is a Fraud

 

·  The Developers Are Not on Social Media

How many people do you know in your circle do not have an account on social networking platforms? If you had to make a list of those who do and those who don’t, which list do you think will be longer? So, since social networks are so popular, it can get quite unbelievable when you see that the developers behind a particular cryptocurrency are not there on any social network. In many cases, they are present on social networks but when you see the joining dates, you find a common pattern. Almost all of them have joined the social network recently. And that’s what makes you doubtful.

This has happened many times in the past. If someone is in the market to scam you, they would not want to leave signs to be caught in the future. For that reason, these people like to stay hidden. They usually do not have any social networking accounts. However, to make their personalities believable to the world, they create social networking account. However, the date of their joining is quite close or falls on the same date. Whenever, you notice this sign, you should stay away from such a cryptocurrency.

 

·  The Whitepaper Does Not Make Sense

This one is quite common too. Most online scammers give you a clue in their whitepaper. A legitimate cryptocurrency team will try to make things easy for their readers, traders, and investors. They want people to know what their cryptocurrency is all about, and what they are aiming. However, that’s not the case with people who are in the market to scam you. They just want your money and attention. They try to win you over by using language that does not make any sense. New traders in the cryptocurrency market are unable to understand anything that’s being said in the whitepaper.

They read the whitepaper, find a lot of jargon there, and think that they have found people who know their stuff. Yes, the use of jargon makes the developers seem like people with technical knowledge. However, the reality is the exact opposite of that. The right team of developers knows that it has to go in the market to ask for investments. The team also understands that the cryptocurrency market is still a highly risky ones so they will not find any big investors. They have to get their investments from people who are not the savviest in trading.

For that reason, they simplify the language of their whitepaper so everyone can understand. They want people to understand the technology they are bringing in the market. Confusing people with jargons is only a sign that you are looking at a scam cryptocurrency.

 

·  The Cryptocurrency Does Not Solve a Problem

This particular rule applies to just about any product in the market. When you are about to try a new product, you should find out if it even solves a real problem. Every product has to solve a problem. You have a can opener because opening a can with hands was a problem at some point. When a cryptocurrency lands in the market, it has to prove that it is there to serve some value. It cannot just exist to exist. It has to provide value to the people who are going to use it in the future.

If you are a crypto investor or trader, you should look at every piece of detail that the developers of a cryptocurrency share with you. Visit their website, read their whitepaper, go through their social networking posts, etc. to know what problem they are solving. If there is really a problem that their cryptocurrency solves, you will see consistency in their messages, posts, website content, etc. If you feel that they are saying something new every time, you should steer clear from investing at all in such a cryptocurrency.

 

Bottom Line

You cannot ignore the fact that a huge population of people in the cryptocurrency market is of young people. These people are not only mentally immature but they also lack the experience of trading. Many of them are holding on to their digital coins so they can make money. As soon as they spot an opportunity to make money, they jump on it without properly verifying the project. You should learn a lesson from that and make sure you learn about the cryptocurrency in every possible way before you invest in it.