With the meteoric increase in cryptocurrencies among investors, scammers looking to trick people out of their money using various platforms have seen a rise as well.Cryptos are no exception to the widespread fraud that plagues the financial sector, from banking to insurance and investing.Attackers, con artists, and fraudsters commonly prey on weak people who succumb to FOMO (fear of missing out) by enticing people with seemingly attractive schemes.In order to save themselves from getting trapped in fraudulent projects or pump-and-dump schemes, investors should look out for the following red flags before investing in cryptos or project tokens.1.
Absence of a whitepaperAlthough it is hard to imagine, some cryptocurrency projects do debut without a whitepaper. When there is no whitepaper, there are only three possibilities:a) Your investment is at very high risk since the project was quickly put together and is therefore immature.b) The project's creators are novices.c) It is a fraud.There is hardly anything much to say for such projects besides - Staying away.2.
A poorly designed website and an untidy whitepaperFor those unfamiliar with a crypto project, its website and whitepaper are the most crucial sources of contact and information.As a result, great care should be exercised when creating them.Which means:No copying and pasting of information from other projectsExcellent grammar and error-free spelling.A neat layout.3.
Lack of a roadmapA project that does not have a clearly defined roadmap does not have a plan of action in place and has no goals to achieve.The project's future plans are not the only thing that a roadmap lists out.A strong roadmap also acts as a gauge for whether the creators have met their previousRead more on moneycontrol.com