Spotting A Cryptocurrency ICO Scam
The unfortunate reality is that there are a ton of crypto initial coin offering scams out there. They simply take your investment, buy some new shoes with it, and that is the last you will ever see of it. Spotting a cryptocurrency ICO scam is actually not that hard to do, if you know what to look for that is. The point is that for every legitimate initial coin offering out there, there are dozens or even hundreds of cryptocurrency ICO scams, ones that want nothing more than to steal your money. This is why we are here today, to teach you how to spot a cryptocurrency ICO scam so you know what initial coin offerings to invest in and which ones to stay away from.
Spotting A Cryptocurrency ICO Scam – Who’s In Charge?
One of the biggest indications that you need to look out for when spotting a cryptocurrency ICO scam is who is in charge of the whole thing. In simplest terms, you need to be aware of the people running the show if you are to trust any crypto initial coin offering with your money. Who is the person or people in charge? What are their credentials? Are they educated and have experience with crypto? Are they known to be scammers? Are they associated with scammers? In layman’s terms, you need to find out everything you can about the people running the show.
If you have no idea who is in charge and if you cannot find any information about the person leading the charge or the company backing it, you can be sure that it is a cryptocurrency ICO scam. The only reason for people to stay anonymous is because they are running a cryptocurrency ICO scam. If they were real people that are genuine and reliable, with a reliable initial coin offering, there would be absolutely no reason to stay hidden in the shadows of anonymity. Real people with genuine initial coin offerings have no reason to hide their identities.
On that same note, if the initial coin offering is the real deal, there should be no problems in terms of communication. You should be able to contact these folks and get good responses from real people. If you call these guys up and they have no idea what they are talking about and sound like they don’t know squat, chances are that it’s just another cryptocurrency ICO scam.
Spotting A Cryptocurrency ICO Scam – Licensing
One of the next red flags that you should look out for when spotting a cryptocurrency ICO scam is if it is licensed and registered. You see, taking investments from people for an initial coin offering requires licensing. At the same time, trading cryptocurrencies (running a trading system), providing signals, and running crypto lending programs all require licenses.
If you cannot find the system in question licensed anywhere or registered with a regulatory agency, you can rest assured that it is a cryptocurrency ICO scam. This is something that requires legal authority to perform, so doing so without the proper documentation is a surefire way of telling that it is a cryptocurrency ICO scam.
Spotting A Cryptocurrency ICO Scam – Vagueness
Yet another telltale way of spotting a cryptocurrency ICO scam is by taking a close look at the whitepaper. The whitepaper is supposed to tell you all about the initial coin offering, how it works, what kind of R&D has been done, and how the system will be implemented into the greater crypto world. If you come across a crypto’s whitepaper and it is very vague and missing a lot of important details, you know that it is a cryptocurrency ICO scam.
A real crypto initial coin offering whitepaper is going to tell you all of the basic and technical details to a full degree. If the whitepaper simply explains that it is a new digital currency with many ways of making a profit, it is probably a cryptocurrency ICO scam. These guys, when they are real and legit, have no problem getting down to the gritty technical details. Once again, even if you are a newbie, if the whitepaper is really simplified, like it was meant for a 10 year old to read, don’t invest in the initial coin offering because it is most likely a scam.
Spotting A Cryptocurrency ICO Scam – The Community
If the initial coin offering is real, legit, and a great opportunity, there should be a big community abuzz with talk about it. There should be lots of people talking about it on various websites, all with mostly positive things to say. Now, there are some bad blogs and review sites out there, ones that knowingly back scams, but there are also many legit ones.
For instance, if you look up a specific initial coin offering on Google and the first 5 results all tell you to run for the hills because it’s a scam, you know that it is a scam. At the same time, if there is very little or no talk on forums, blogs, and other crypto websites, it is a big indication that the initial coin offering in question is a cryptocurrency ICO scam.
Spotting A Cryptocurrency ICO Scam – The GITHUB Factor
Something that you should always do before even thinking of investing in an initial coin offering is to go to Github. In essence, this is a website that keeps track of this kind of thing. The people running the show should be putting up updates about development, new developments, ideas, and progress being made in terms of creating the initial coin offering and everything around it. Any initial coin offering worth investing in should be listed on Github and there should be a lot of activity surrounding it. If there is little or no activity on Github, chances are that it is a cryptocurrency ICO scam.
Spotting A Cryptocurrency ICO Scam – Conclusion
As long as you follow the tips and rules we have outlined above, you should be able to spot a cryptocurrency ICO scam from a mile away.
If you would like to find out more about cryptocurrencies and cryptocurrency trading, go to our Cryptocurrency Explained section!
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