There’s no doubt that the world of cryptocurrency is growing remarkably fast. And it’s no surprise that scamsters will lock unto this endless opportunity like a heat-seeking missile. Even one of the most widely known cryptocurrencies, Bitcoin, is no exception to this threat.
Just recently, the social media and digital security monitoring company ZeroFOX reported about the dark side of digital currency. According to the report, a new type of financial scam involving bitcoin is rapidly spreading across social networks.
However, with the cryptocurrency market growing very rapidly, have it in mind that scamsters are becoming more sophisticated than Ponzi schemes. And before you invest in any of them, try to explore the following unconventional red flags that indicate a cryptocurrency is a scam.
1. The cryptocurrency has no local exchange, only internal exchange
There’s no genuine cryptocoin that can’t be exchanged into a local or fiat currency. For example, cryptocurrencies like Bitcoin and Etherum have local exchanges where they can be converted into fiat currency.
Unlike most of the scam cryptocoins out there designed in such a way that they can only be exchanged internally — that is within its community, such ‘community’ is usually a Ponzi scheme.
Note: A genuine cryptocoin is not being traded internally, but can be converted into traditional currency by local exchanges such as Poloniex, Bittrex etc.
2. The cryptocurrency always appreciates in value
Beware. This is another strategic method of getting into your pocket. Whenever you come across a coin that only appreciates, you have in front of you a scam coin. How can you be sure?
One of the characteristics of currencies (either digital or fiat) is volatility; there are times when it goes up and down in value due to ‘market factors.’
Scamsters understand human psychology — our love of making just profit. So, they’ve developed several coins that will only appreciate in value daily, knowing for sure that many people will fall for this.
Source/More: 6 warning signs you’re about to be crypto-scammed