Signs That You own a Shitcoin & How Not To Get Scammed
If, like me, you watched the price of crypto currency rise, making people shit loads of money in late 2017 and thought, “I’d better get some of that action”, then you better read this article and take some advice from someone who has had to learn the hard way. Once you can identify the Signs That You own a Shitcoin & How Not To Get Scammed, you’ll able to make better inform investment decisions.
After noticing that institutions and countries were also paying attention and investing in both crypto currency and blockchain technology, it’s understandable that you were tempted to have a dabble yourself. So you went onto a platform like Coinbase and excitedly made your first Bitcoin purchase. But that wasn’t the end of it, was it ? You were hooked and started looking closely at Altcoins as well.
Now we come to the big question, what are the Signs That You own a Shitcoin & How Not To Get Scammed.
Are the Altcoins you’re going to buy or already bought any good or are they simply Shitcoins?
Signs That You own a Shitcoin
What signs should you look out for that you are buying a Shitcoin?
The best way to avoid buying a shitcoin is not to rely on other people’s opinions but instead to DYOR, (Do Your Own Research). Use sites like cryptosage.co.uk to research the developments you’re interested in by clicking on the coin name and reading everything there is to know about the coin, including the information in the coin’s whitepaper, which is the same as a project’s business plan.
Don’t be influenced by a sales pitch or social media chat groups shilling their bag as if it’s the next best thing out there like going to the “MOON” or it will “Buy you that Lambo.” You’ll find that the slightest price increase and they’ll be selling and bailing out.
Here are some pointers on how to identify a questionable Blockchain project or coin site that should be avoided.
1/ Ambiguous website or single page website
Your first impressions of a project’s website should indicate the developer’s grasp of the technology involved in the crypto currency industry. The website shouldn’t be vague or difficult to navigate; it should be an up-to-date, well-set out and sleek website with a page that contains their whitepaper. The whitepaper should clearly state the project or team’s vision with a step by step explanation of their purpose and exactly how they plan on achieving their set goals. Images of their directors and company registration including business address and contact number is the perfect way to gain trust.
Whitepaper plagiarism is prevalent in the industry, so lookout for websites that have whitepapers with vague or meaningless buzzwords and waffle such as, “We’re building the world’s first peerless blockchain-powered with peer-to-peer decentralized distributed trustless ledger protocol with cutting edge algorithm integrated technology for future global sharing economy through smart contracts, our coin is destined to be bigger and better then Bitcoin leading to mass adoption” or something like that.
2/ Hello, Any one there?
I’ve come across websites with no Director’s details, contact number or company operation address. Even after doing an extensive internet search, I still couldn’t discover who the directors were. Decentralised doesn’t mean complete anonymity. I would be cautious of dealing with these websites as I would consider them to have no real project behind them and can easily disappear, taking your money with them.
Developers or coders requesting anonymity I can understand but founders, CEO’s, marketing and advisory executives of legitimate projects should typically be visible on their website.
Management of top end projects may set up a business profile page on LinkedIn, Twitter, and Facebook in addition to others social media platforms. This openness allows you to easily reach out and contact members of the team if you have any questions.
If I don’t see management photos or channels for investors outreach, I would consider the project suspicious and best to be avoided.
3/ Project with no aim or real purpose
Projects with nothing more than a plagiarised whitepaper with all the right buzzwords will most likely fizzle out before they create any significant product but not before having encouraged investors to part with their money.
Prior to launching, if a Blockchain project / ICO (initial coin offering) isn’t trying to solve an industry related or real-world problem, or if they state that once they have been funded through seed money, crowdfunding or investor money they will endeavour to create functionality or purpose through R&D (research and development), then their attempt may be seen as nothing more than a money grab.
You may have read news articles that the Securities and Exchange Commission (SEC) have been issuing Cease and Desists to ICO’s with no real functionality or purpose prior to gaining investor, crowdfunding or seed financing. Some have disappeared into obscurity with investor money while others have been forced through threats of legal action to refund/reimburse investors.
Before investing, consider the purpose of the new project and whether that industry will benefit from blockchain technology or tokenisation. After all, real projects will have a growing list of partnerships with similar players in their niche with real customers and structured revenue streams.
4/ Social media links
This is a difficult one as too much social media hype can be indicative of a scam but then again, the lack of activity on social media is also a bad sign for a coin offering or development.
On the one hand there may be a small team of coders and developers trying to create code but then on the other hand if they’re not forward with their development communication you’ll wonder if they are being as open and upfront as you’d expect.
A solid project should have an engaging series of posts with legitimate project updates, are public about on-going development and will deal with questions, concerns and queries professionally. Real projects welcome feedback.
A number of observations to consider;
- Can you reach out to admins on Telegram?
- Do they have a Twitter or Facebook account and post regular updates?
- Do they have Commits on GitHub?
- Do any of their management or development team have LinkedIn profile pages?
- Does their profile have a person’s face, an image of their logo or is it blank?
- Does the project have an active community on Reddit or steemit, etc?
- Have you tried posting a difficult or probing question to the team? How satisfied were you with their answer or did they ignore it and ban you from their site?
What I look for are real people I can reach out to. Observing answers they provide to questions posed to them, and which reputable investor are backing or associated with them.
5/ Approach with caution
Maybe at the beginning of the crypto breakout, investors may have been a bit more trusting and less cautious but as we’ve seen the eruption of uncertified ICO’s, dodgy exchanges and even established exchanges with an elaborate exit plan with internal and external hackings, this has left the crypto industry as the decentralised wild west with easy pickings.
Even novice investors have become savvier and will utilise social media chat groups, forums and DYOR to be better informed before deciding to invest in ICO, STO, IEO, mining, trading, forex, binary utilising mobile and computer storage, staking, games playing, etc.
Continued overhauling of the crypto industry through the introduction of new Bills, Laws and Regulation by the SEC, which are being adopted and implemented globally, will hopefully purge shitcoins and exchanges that seem to be operating unregulated.
However, this will not eliminate scams altogether, as we know in life wherever there is money there will always be scam artists and victims left out of pocket.
So, keep your wits about you and don’t let FOMO (fear of missing out) make you too eager to part with your money. We all want to become billionaires by tomorrow but there’s no way of telling if a development or coin is 100% legit or genuine without doing some research.
Finally: Sounds obvious but don’t make the mistake of giving out your personal information, passwords, key codes, transferring money or crypto to strangers contacting you on social media as that’s a sure-fire way of being scammed.
For example, If you’re gullible enough that an unknown person on any social media site promises you that by investing $100 or whatever amount with them you’ll receive ROI of $3,200 in 24 hours then you can bet you’re goin to ba a victim of a scam.
Nothing in this article is financial advice. I am not a financial adviser. Please consult a professional financial adviser if you’re looking for financial advice.
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