Virtually all markets where you operate with money or forms of value are exposed to fraudsters. Scammers are people who bend every cane and stone to get a hold of your valuable assets. It is therefore important not to be naive, and always take precautions seriously. It is unfortunate that a lot of people, especially newbies forgets this. Those who remain as victims in such situations are new and ignorant, who may not know exactly what they are doing. One nice thing one should always keep in mind is that one should never completely rely on an unknown second party on the internet. The stock market, different gaming economies with marketplaces, and internet scams in the form of stealing sensitive information, values and counterfeiting are among the most popular arenas. Scammers try on all fronts, and the list can continue several pages.
The crypto space is no exception. Perhaps also spatially exposed. Everything is very open, with little guidelines, which scammers know exactly how to exploit. There have been many news stories that have featured large sums of cryptocurrency that have been locked, lost or stolen. It is no secret that the reputation for cryptocurrency has had a very negative impact as a result of this, and it is therefore very important that as many people as possible build up a “healthy attitude” on this front as soon as possible. The world is becoming more and more digital for every day that goes, which means that you see much less often or have some physical contact with those you are talking about. This is probably something that also makes it easier for people to steal, because one might never see or get any relationship with the person in the recent past. It is therefore important to be well-equipped in the present and future.
If there is one thing one should be very cautious about in today’s age of the internet, it would have to be phishing. Phishing is simply put websites or different personalities (email addresses, username etc.) that looks completely identical to the legitimate actors. The result of being fooled by a phishing site is that you visit a url that does not belong to the original website and you log in to something you think is legitimate, such as PayPal or your exchange (edo.g. Binance), which later turns out to be just an identical side. You have then entered your username and password and sent it to the scammer’s database. Now, the phisher has free access to your info, can log in to your user, and in theory steal everything you own in the account.
Phishing in the form of personal information is usually fake imposters who are trying to look as identical as the original to fool you into buying courses, sending information or the like. Most often this happens to well-known people in different environments who have a certain credibility. It is therefore always important to check that the website you enter is always legitimate, and that people you talk to or contact is the person they claim to be.
Do not give out passwords, private keys, files or assets
This should go without saying, but it is still important to note down. For example, it has become a trend that people claim that they will “double” your value. The concept is as simple as sending a counterparty a value, and in turn, they promise to double the value that was sent after 1-2 weeks. Doubling of course never happens. One can probably imagine that this is too good to be true and that no one had gone on something like this? WRONG. I’ve even seen a known Twitter account stolen, then spread the doubling message. The address received well over 20,000 USD in about 4 days. I also know of another story about a man who was asked to upload the .json file (acts as a private key) in order to join an ICO as proof that he was the one who was applying. Call it a “Know your customer” process. About 5 minutes later, about $ 20,000 was lost from his account.
It is recommended to always use two-way authentication. Never share passwords. Regardless. There is never anyone who will ever need your .json file, your private key, or your password for anything else to get into your user and steal what you have.
Never store valuable assets on the stock exchanges
After the cryptocurrency’s huge rise back in 2017, we have seen several exchanges fade away. Many have made so-called “exit scams” where they simply run away with the assets left on their stock exchange. In other words, the money to people. There are many reasons why even established exchanges does this. Most people who scam their users see that their turnover is dropping. It has most likely already made it over a long period of time, in step with the descending market cap of the crypto market.
Instead, people send their assets over to the large exchanges with more volume, which makes multiple exchanges die out slowly. After the 2017 recovery, a lot of exchanges were created, all of which hoped to serve in a hot market. In the bearish market we are in today, the liquidity has accumulated in a few major players. The smaller ones simply no longer survive, and take with them what they can. The vast majority of exchanges blame some external thing like “they were hacked” or something similar. In other words, it is not safe to have large sums of money on an exchange. Even the biggest and most trusted can also become a victim of hacking, even if it is a legitimate attack or not.
Anyone who has large amounts of cryptocurrencies or plans to invest large values should consider acquiring a hardware wallet and store the private key in a safe place that can overcome anything from flooding to fire.
Do Your Own Research!
Ultimately, you are using your own hard earned money to buy cryptocurrency. If you do not understand the product or value of what you are buying it is your fault alone. If you only listen to “experts” on Medium, Twitter or Slack that tell you what and when you should buy and sell, you’re most likely to end up in more trouble than you should.
“If you trust someone else than yourself to buy a value, you must also rely on them to know when to sell”
The main point is that investors should read up on the projects for themselves. Start researching, and learn more. Make your own opinion, and don’t shape it out in from a bit of information that might support something you thought of before, and therefore you continue to believe the same thing. Break your mind and opinion patterns, so maybe you can find out even more exciting, in both good and bad ways! So do your own research, for yourself! 🙂
Note: The post may be updated. If you have anything else you’d like to have on the list, send it in.