One of the reasons that crypto can be so daunting for newcomers is the number of scams that currently infest the space now while some are pretty obvious others are more subtle and damn near convincing scams have to evolve in order to keep their business profitable so they're adapting and have also been able to con users who may have thought they were immune to it are any of these scams just waiting for you around the corner.
Trick 1 : is any website asking for your private keys. The trick is very simple they ask you for your personal information specifically for something called your private key now it's really sad to me how many scammers out there take advantage of someone's lack of knowledge and then try to get you to tell them your seed phrase by doing this they are actually getting access to all of your crypto funds some of these scammers might say things like hey i want to send you some money what's your key or even something like hey you just won one whole ethereum tell us your seed phrase so we can deposit the funds in your account they'll try every trick possible to fool newbies into giving them access to their funds when it comes to crypto you actually get two keys a private key that you should never ever share and a public key that is kind of like your email address this one you intentionally share many people confuse these which leads them to getting scammed you can learn more about both of these by watching our video on asymmetric encryption which is a complicated topic that we break down so simple your grandpa could understand the next scam we have is number two asking to invest for you as a trusted creator
Trick 2 : is something that might be used to you that telegram servers scammers will create a bot that seems official or try to impersonate a project specifically a team member and then they will dm you so that they look official and they do this in hopes of scamming you in some way one of the most common scams is the way that they ask for a hundred dollars and then they'll turn it into two thousand dollars for you and give it back they're basically claiming to invest your money for you. A scammer will send you a dm moments later saying that they're a project team member and that they can assist you they often change their username or their profile picture to impersonate a real team member.
Trick 3 : is burning a percentage of a token or sending it to a dev wallet. Now another scam well at least it's kind of a scam is that token developers will implement something that is called a burn feature they will say every time this token is traded a portion of the trade is burned forever so an example of this is that if you were to send 100 tokens to your friend five tokens would be burned forever or at least sent to an account that nobody has access to this makes you believe that one day there won't be very many of these tokens out there and if you buy now and then just hold the value of your tokens should automatically increase and for it to have value keep this in mind with tokens that have a deflationary feature especially if that's all that they offer scam.
Trick 4: is something that someone contacts you and says something like this hey i live in china and they just made crypto illegal so i want to get rid of my wallet so i don't get in trouble here's my seed phrase you can donate the money or do whatever you want with it and maybe have some for yourself then after that message they will actually send you a real seed phrase to an actual account with actual money in it the one that had three thousand dollars worth of tether but here's the trick to get the tether out you must first have some ethereum in the account to pay the gas fee so if you're kind of smart you'll think them. Anyone can just send it to their own account, to do that you have to deposit like 50 of ethereum so you can actually transact the money out of the account well it happens to be that the fee to transact a token is like fifty dollars while the fee that send ethereum is like ten dollars so you deposit fifty dollars and then immediately the scammer sends the money to their account profiting forty dollars really fast like within ten seconds they have a computer running a program that checks if there'sfunds in that account and then automatically sends it to their ethereum account so there is absolutely no way for you to get the three thousand dollars out of there now the sad part of this is the blockchain is available for everyone to see so you can literally look at the account on etherscan and see that 30 people were scammed around 2800 in total
Trick 5 : is a smart contract bug so another trick that scammers use which you may not even be aware of is a bug where people can buy a token but then they can't sell it now. There are actually three ways of doing this first when the developers are creating the token they simply disable the approve function in the erc20 token contract basically meaning decentralized exchanges cannot get your approval for putting the token to be sold the second way is to add a rebase function into the token contract so at the moment you try to sell the token you'll lose 99 of it third they could easily write a few lines of code that prevents the token from being sold to a dex only bought or supplied this means a lot of money coming into the project and none is going out making it a perfect situation for scammers to run away with all their money technically they could make it so when you sold your token the money you would have received goes to thedevelopers also now to sum this up you needn't to learn how to read smart contract code but before making any buy over a thousand dollars you should find a friend who can
Trick 6: is fishing on fake websites the next technique is something you really need to be careful of and keep an eye out whenever you discover a new project or you browse using a new device or a computer some scammers will create a website that is an exact copy of a specific crypto project that you actually want to invest in and they'll do it with the same user interface and the same information on it the only things different from this fake website to the real one are two things number one the domain because scammers can't use the same domain as a real website they will actually create a new one that is almost the same as the real one for example scammers could create a fake whiteboard crypto website switching it from the dot com to the dot org dot net dot phi dot x y z or any other top level domain they could also add an s to the end like whiteboardcryptos.com or to move the whitboardcrypto.com anyways the idea here is that they change this little detail so people don't realize they're on the wrong website the second thing they change is the smart contracts and this is the scammy part the scammers could change the smart contracts code so that if you were to interact with it they could get access to your funds in your wallet leading you to losing all your money in fact they can make this contract do literally anything which is why it's really important to only connect to applications that you trust.
Trick 7: is fake icos so you know how kickstarter projects or really any crowdfunding projects get the money they show their product that's yet to be manufactured and then people fund the project in exchange for a great deal maybe they'll get two products for the price of one or maybe a special edition version in crypto we have something similar and it's called an ico or initial coin offering and it works as a way to gather a lot of money from investors so that they can start the project well fake icos are a really easy way for scammers to present a project to investors with absolutely no intention of actually creating it and then just run away with their investors money how it usually works is that scammers present a really nice innovative revolutionary project to the investors they then ask for money to kick off their project and lure inexperienced investors in with a juicy roi like a hundred percent or a thousand percent and this leads to the investors giving their money but then the scammers just run away with it and because many projects in the crypto space are not regulated unfortunately the scammers pretty much get away with it a good thing to do before investing in a crypto project is to look for legit white papers a project's timeline or good tokenomics to back your investment don't just look at the great user interface or the juicy roi.
Trick 8: is called hidden whales you know to be careful with projects with low liquidity or a low market cap because they can easily be manipulated by a whale well a whale is anyone holding a high percentage of the tokens out there and because of this they have the ability to sell all their tokens at once causing a crash anyways since this is kind of obvious and since scammers are aware that people will actually look at it before investing money into a project scammy projects have now found other ways to hide the fact that they hold most of the token instead of having one wallet with all the money they simply split it between multiple wallets for example if the total liquidity of a project was half a million dollars and maybe the team was holding fifty thousand dollars which would be ten percent of the entire project they would then split the money into ten different wallets each wallet holding five thousand dollars this way they make it look like a safer and legit project now.
Trick 9: is psychologically making you think that a smaller price is easier to be able to hit a higher price now this one is technically not a scam but it's kind of tricky when a project launches the tokenomics are established by the project's team developers get to answer the questions what is the max supply of the token what's the initial price of the token and yes they can set that and who gets the early tokens all of this stuff is decided in advance now something quite a few scammy projects do is simply print a very large amount of tokens that way the price stays low even if there's a lot of money behind the entire project between you and me owning 100 tokens at one dollar each is the same as owning a hundred thousand tokens worth a tenth of a penny right well in people's mind having more tokens with a low price is way more tempting psychologically because it makes them think with a price this low it'll easily double or triple or 10x or maybe even 100x in value along with this they also get to feel like they're owning a ton of tokens for these investors it's cool for them to say that they own a billion tokens but in reality going from a tenth of a penny to a dollar is just as difficult as another token going from one dollar to a thousand dollars so this trick is really about making people think their gain opportunity is higher than it is which makes people invest more in the token so make sure you don't invest in a project only because the price of the token is low because if you do it might be a game of limbo and you're gonna see how low it can go.
Trick 10: is gambling with your trust the last scam is something we saw with the latest hottest scam the squid games token these developers capitalized on the fact that a show called squid games became very popular and they rode the hype train using the same name so that that way they could get a lot of attention but this is not the trick i'm wanting to talk about to create a false sense of safety they actually created a fake team yeah you heard me right they created around 10 fake profiles with fake bios to make it seem like the project had a great and solid team behind it they went so far as to add computer generated pictures of people in fact people that did not even exist just to make the project seem more legit the only thing i want to say about this one is that crypto scams are getting more and more persuasive so you'll have to work a lot harder when making a decision on a project.
Hence as a summary before investing into any cryptocurrency do check all the above creteria and to decide where to invest read the article top 10 cryptocurrencies now.