Signs of online Scams

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Cryptocurrency is frequently referred to as being a bit of a Wild West environment. It's true, this is, at the end of the day an unregulated market where volatility is standard, security and self ownership is crucial and you can easily make or lose a fortune in a short period of time. As such, it is very important to be aware of the signs of online scams in order to protect you and your account. There will always be less than scrupulous people actively trying to relieve you (or scam you) of your Cryptocurrency.

Key Red Flags When Looking at an Online Business

Below I include some red flags you should look for in businesses before you store or grow your Cryptocurrency there.

  • Offering unrealistic and unsustainable high returns
  • Claims of returns with no externally verifiable way to prove it (always check over information yourself – it’s your crypto after all)
  • Having an unnamed team of experienced traders/professionals
  • Owners (if named) having no other digital footprint
  • Owners having a digital footprint that has clearly been made up
  • Owners having promoted scams or dubious companies in the past
  • Using words like ‘guarantee’ or ‘risk proof’
  • Poor spelling or grammar
  • Showing a simple registration document (one that is cheap and easily available and requires no proof of business activity) and claiming that is proof of legitimacy
  • Using complicated words, not being able to explain a concept simply and clearly
  • They use pressure tactics or over-hype
  • Not being registered or compliant with the appropriate governing overseers (SEC for example)
  • Company is based out of a virtual office and or based in a tax and extradition haven (frequently Dubai, Panama, Vanuatu)
  • Check out and if the website is recently created, created anonymously and has only been purchased for a year, this is a big red flag

These are not exhaustive and some red flags are more obvious than others. Always do your due diligence, and trust your instincts.

Worth the risk?

Higher risk platforms can provide ambiguous answers to several of the questions and you may well decide to invest there if you feel the risk is worth the reward. However, I would recommend if you do, to limit the number of platforms of higher risk you get involved with as they can change quickly. I have two categories of higher risk platforms to grow your wealth with. You can read about my Smaller Capital Quicker returns here and my Larger Capital Longer Term Platforms here.

Once Invested in a Platform be Aware of these Red Flags

Once you have assessed the platform and if you do decide to use it to either store or grow your Cryptocurrency, you will want to regularly reassess with fresh and unbiased eyes. Key red flags to look out for then include –

  • Changes to minimum/maximum deposits and withdrawals
  • A shift in the way things have always been done (suddenly restricting withdrawal windows or amounts, or implementing KYC)
  • Excessive hype regarding the platform or the people involved with the platform
  • Delays in payments
  • Offering excessive promotions
  • Providing distractions to stated plans or everyday running of the business

Listen to your Gut

Remember as well, your gut instinct is often right. The best way to be attuned to it is to know yourself and to understand the inherent risks of the platform. Know if you are an investor or a promoter. If you are an investor try to stay away from companies that offer binary/MLM structure (or get in early and keep to a strict withdrawal strategy), as generally to benefit from that you must want and be able to promote, to truly benefit from the platform.

Something for Everyone

The great thing about Cryptocurrency is that there is truly something for everyone. If you are feeling overwhelmed and would like a step by step guide that is tailor-made for you then consider a 3 month Portfolio Plan. You're welcome to get in touch to discuss any questions and join my Facebook Group Crypto All in All.

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