Introduction
The free crypto ecosystem is full of various scam attempts. Every day new scam websites are launched (see my list of scam pages. The insane number of scam attempts can probably mean a bad thing - some of those little projects are successful.
In this post I am revealing the basic principles how to recognize the obvious and not the so obvious scam websites. I investigate many scam sites and this post is describing the common features I have identified.
Unreal profit promises
Probably the first and most easy thing you can check is what they are offering. If they offer too much too soon, it is definitely a scam, no matter what they argument. What is too much and what is reasonable? In the most of the world countries, the saving interests offered by regulated banks are below 1% per year. Keep in mind, the inflation is higher than that most of the time at the most of the countries. Some trustable crypto services offer much bigger interests. Commonly you can see something like 2-5% per year (freebitco.in, Coinbase, Binance). There are some exceptions with interests close to 10% per year - mainly for stablecoins (Crypto.com). At this moment, I conclude that everything above 10% per year is highly suspicious. If someone offers you 200% per year or 10% per week, you can be sure it is a joke or a scam.
Lack of transparency
Scam projects rarely explain how they earn money to cover your earnings. The reason is simple. They do not explain, because there is nothing trustable to say, so they rather say nothing. I have not seen many scams trying to explain something to their users. But a few examples are worthy to mention:
- We are running money tumbler and we need many transactions to cover it. Although it sounds somehow trustable, it is not possible. Check the average prize of money tumbling services and you will see there is no chance they can earn that much money.
- It is the miracle of bitcoin mining. You need to be totally naive to trust this one. It is not even an explanation at all. There are no miracles in a real world, nor in bitcoin world.
- It is really complicated and it cost us a lot of money to find out. We cannot tell our secrets to everyone. This lie is another scam gem. You are not asking for secrets. You are asking for basic information - and they should tell.
Challenge for your impulsiveness
Because the scam sites have nothing trustworthy to offer, they try to challenge you to take a risk. They say things that sound way too good to be truth. See some of their funny statements:
- It’s easier to earn on crypto investments then you think.
- It's time for simple and understandable solutions!
- All restrictions exist only in the minds of people. Maybe this is the only chance you get in your life. Who knows? So ... act NOW !!!
- Making money with us without expert knowledge is easier than you think.
- We will give you a lot of money, even though you do not deserve it.
- You have to risk to gain (send us money), it is your last chance.
- Sending money to us is not a risk.
Positive reviews and evidence
The problem with reviews is simple. The reviews are written by people. And some people can lie, while other people can trust false assumptions. So keep in mind, positive reviews does not mean anything. The portals displaying reviews are not working for a greater good, they are working for money instead. Also keep in mind, that picture or video is not a proof. Today, anyone can fake any amount of evidence. Do not be stupid. Just because you or someone else would like to trust something, it does not become a truth.
Conclusion
The major points of this post can be summarized as follows:- If something sounds good, it is a scam.
- If they cannot explain their business, they are scam.
- Do not trust fake proofs.
- Do not trust random reviews.
- Do not risk nor guess, there is enough time to think and ask.
- Do not be stupid.