The amount of trust in cryptocurrencies has increased tremendously over the last few years, but so has the number of cryptocurrency scams. Cryptos are not maintained by the Government which makes them highly prone to risks. Furthermore, as it is a new technology, it takes time to make laws. There have been several crypto scams, Theranos for example is a 10 billion worth of crypto scams that crippled a lot of major investors. So how to get out of this bandwagon of cryptos?
Identifying Cryptocurrency scams:
The answer is not easy. Try to read information from very reliable sources, this can include from trustworthy newspapers to high-ranking investment fund managers. It is easy to get swayed by the public charisma of the CEO, this can get dangerous.
Theranos too had a CEO whose public appearance made everyone believe that all was going well while 10 billion dollars went down the drain. If any fund is giving you a surety, that is a compulsory increase in value, then you should flag that fund. Cryptocurrencies can get extremely volatile and there is no certainty. Furthermore, try not to keep all eggs in one basket. Diversify your portfolio and constantly check on updates.
There are a lot of cryptocurrencies flooded in the market, trying to find their board members and all the key financial information. This might be hard to obtain, but there are a lot of investigative journalists that constantly update on these cryptos.
To conclude it is hard for one person to identify and report crypto scams, but if you do work with a group of people and constantly look for updates, then it is possible to scrutinize the scam. There are analyst ratings given as well which are very helpful when deciding on which crypto to invest in.
