Beware of Crypto scams- Rug PullsWith the crypto market on a strong run since October of last year and with many dreamers hoping for 100x or even 1000x returns, we must be extremely cautious of scammers.
In this article, I will explain one of the most common types of scams: Rug Pulls.
The term "rug pull" in the cryptocurrency industry refers to the moment when the founding team abruptly abandons the project and sells or removes all liquidity. The term originates from the phrase "pulling the rug out from under someone," meaning the unexpected withdrawal of support.
In 2021 alone, during the previous bull market, rug pulls were responsible for losses of approximately $2.8 billion, a figure close to historical highs and an 81% increase compared to 2020, according to a report by Chainalysis.
The cryptocurrency market is susceptible to such scams due to the lack of regulations from central authorities. Unlike traditional companies subject to strict government control, the decentralized nature of the crypto space allows for complete control by private entities. This makes it vulnerable to exploitation by these entities.
Types of rug pulls:
Liquidity Theft:
Liquidity theft is the most common type of rug pull. It involves a developer listing an altcoin on a decentralized exchange (DEX) where it can be traded with a top currency like Ethereum (ETH). To enable trading, the developer must create a liquidity pool.
The team generates hype around the new project and attracts investors. As more investors join the project, the coin's price rises, attracting others who believe the project is a viable opportunity. As the coin increases in value, the developer withdraws all ETH from the liquidity pool at some point, leaving investors in the pool with no way to exchange their now-worthless tokens.
Technical Manipulation:
Some developers intentionally design tokens with the aim of deceiving investors. Therefore, they will include specific lines of code to limit the ability of retail investors to sell, thereby controlling both demand and supply. Of course, they are the only ones capable of selling, and when the price has appreciated sufficiently, they will sell all the tokens they hold.
Dumping:
This means that developers or promoters who hold a large percentage of the total coins sell off their entire holdings. As new entities invest in the new cryptocurrency, they exchange their valuable cryptocurrencies such as BTC or ETH for the new cryptocurrency. As a result, when the price increases significantly, developers sell off all their tokens, causing the price of the cryptocurrency to plummet.
How to Protect Your Investments from Potential Rug Pulls?
Lack of a Website:
Not all projects start with a website, but many that intend to exist for a long time do. If the developers of the token you want to invest in don't have a personalized domain for their project, this is a clear warning to stay away. There are also fraudulent projects that have websites claiming to be under construction or launching soon.
Check the White Paper:
This is an excellent way to learn about the plans of the project you want to invest in. Check for the existence of such a document, as well as any discrepancies between the white paper and the website. ALSO, VERIFY IF THE TEAM IS AVAILABLE TO PROVIDE INFORMATION ON PLATFORMS SUCH AS REDDIT OR TELEGRAM. If a developer cannot answer basic questions about their project, this raises major red flags.
Anonymous Developers:
While the identity of Satoshi Nakamoto, the developer of Bitcoin, is not known for certain, the fact that a project you want to invest in has anonymous developers should raise concerns. If the developers of a cryptocurrency or DeFi project choose not to associate their names with it and remain in the shadows, they may have reasons for doing so, and it's best to avoid such a project.
Low Liquidity:
Low liquidity of a cryptocurrency means that it is difficult to convert it into fiat currency; therefore, the lower the liquidity, the easier it is for developers to manipulate the price. The best way to check the liquidity of a cryptocurrency is to analyze its trading volume over the past 24 hours. A general rule used by experienced investors is that the trading volume should be more than 10% of the coin's market capitalization.
Locked Liquidity:
To provide trust and enhance the public perception of their legitimacy, developers of serious projects will relinquish control over the liquidity pool by locking it in the blockchain often with a trusted third party. This process is called locked liquidity and prevents developers from trading with tokens from the pool, thereby making it impossible for them to steal or dramatically reduce liquidity. If liquidity is not locked, then nothing prevents developers from withdrawing their funds.
Low Total Locked Value (TLV):
TLV is another reliable measure to verify the legitimacy of a project. This term refers to the total amount invested in a particular project. Serious projects have a TLV of hundreds of millions or even billions of dollars, while newly emerging projects with only tens or hundreds of thousands of dollars in TLV should definitely be avoided.
Token Distribution:
Checking the token distribution of a project on Etherscan or Binance Smart Chain explorer will show who holds the largest amount of tokens and how they are distributed. If a single wallet or two hold more than 5% of the total available, there is a risk that the price may be manipulated.
The Project lacks an Audit Report: The most notable projects will have independent audit reports in the fields of security and financial transparency, guaranteeing their authenticity. A project without an audit report is not necessarily fraudulent, but it means that you should research the project in detail before investing in it.
Losing investments through a rug pull is a common phenomenon; therefore, before investing in a project, it is wise to analyze the project, developers, liquidity, and also the developers' activity on social media platforms.
Additionally, you can opt to use online tools that can detect a potential rug pull. One of these tools is Token Sniffer. This site lists all the latest hacks and scam coins. Rug Doctor is another useful tool for detecting rug pulls. The site analyzes the code of crypto projects, attempting to identify the most common rug pull strategies.
Stay safe and good luck!
Mihai Iacob
Scamcoin
Filecoin Crashing Hard – TOLD YOU SO!As I type this, filecoin is crashing hard and has formed a clear double top on the hourly chart.
I have been the only one warning you about thit shit show of a garbage shitcoin and now I can say: I TOLD YOU SO.
Filecoin rejected AGAIN - 80% crash imminentFilecoin rejected AGAIN - 80% crash imminent.
When a coin such extreme weakness in extreme bull market, it is very bad sign and it makes it much likelier that the coin will crash severely, ruining every bull in the process.
Filecoin is a great example of an extremely weak coin. It was $230 and now barely $5. Buying this coin make no sense, it's going to $1.
Huge Filecoin Crash Coming: Target $1While other coins have pumped massively for the past month, filecoin keeps struggeling with a major resistance. This is extremely bad when the rest of the market is pumping and breaking resistance after resistance with extreme ease. Since the market is poised for a correction, and since filecoin is pausing at major resistance for the 4th time, the chances of an epic CRASH are incredibly high (99% likely). I expect filecoin will crash another 80% soon.
❗ WATCH OUT 👎 SCAMS & WORST Crypto's for 2023Hi Traders, Investors and Speculators of Charts📈📉
Many of these projects might come as a shock and be disappointing.
As the markets evolved and crypto regulation has taken a more prominent stance; scammers have had to become smarter. The latest trend seems to be a rug pull and then just let the rest of the project's liquidity bleed out. In other words, remain borderline active as they drain more and more funds over a longer time.
Hundreds if not thousands of new cryptocurrencies launch monthly. All with big promises of use case, flashing tech and a stock-standard wide mouthed YouTube guy telling you how high it will moon. With these new tokens and coins also comes many initial coin offerings (ICOs) that are often scams. The demand for these have grown, even despite the fact that many people get rugpulled. This mostly unregulated market makes for a perfect place to scam innocent people out of their money, with little consequences to the thieves. When it comes to cryptocurrencies, one of the biggest challenges for investors is not getting caught up in the hype. Digital currencies have quickly risen to prominence in the portfolios of many retail and institutional investors. At the same time, people are still shocked when something like LUNAUSDT / TERRA happens.
📛 C+CHARGE / CCHG USDT 📛
Initially, the fundamentals sounded noble. But after some research, most members of the team are unverified and there has been no real project activity since late 2022. Apart from this, a coin that loses near 100% is ALWAYS a bad sign and indicates a rugpull, more than anything else.
📛 LUNC As seen on the chart / Terra Classic 📛
A noble rescue at first... TerraClassic community continues to create social media buzz based on the idea that brokerages listing LUNC will implement a burn tax that'll reduce the max supply of close to 6.9 trillion tokens. But even burning billions of coins won't have an impact with a max token supply this large.
The bigger problem is that TerraClassicUSD has de-pegged and its native coin Terra Classic no longer serves any purpose. With all blockchain work now revolving around the new Terra, Terra Classic and TerraClassicUSD are shell investments, with nothing to back their value.
📛 FTT / FTX Token📛
Why Kukcoin hasn't delisted this is beyond me... Te infamous token of the Sam Bankman Fried saga, more on it here:
📛BURGER / BURGER COIN 📛
. .. REALLY ?
📛 PIZZA 📛
AGAIN, really...
📛 Bitcoin Gold / BTGUSDT 📛
Bitcoin blockchain underwent a fork in 2017 called BTG. Although the fork was meant to produce a more decentralized form of Bitcoin, it has not been successful. BTG was created to address the issue of mining centralization in Bitcoin, but it has not been able to achieve its goal due to the emergence of specialized mining hardware.
Just DON'T. DON'T DO IT. Buy the real thing instead.
📛 PITBULL / PIT 📛
I'm letting the dogs out on this one.. That decimal is basically falling off my screen.
📛 BLUR / BLURUSDT 📛
__________________________
💭 All the above said. Let's discuss a few ways to navigate this wild west market:
- Research the team . Perhaps the single most important success factor for any ICO or cryptocurrency is the developers and administrative team behind the project. Check out their Twitter and Reddit. The cryptocurrency space is dominated by major names, with superstar developers like Ethereum ETHUSDT founder Vitalik Buterin capable of making or breaking new projects simply by having their names listed on a development team. For that reason, it's increasingly common for scammers to invent fake founders and biographies for their projects.
- Check the whitepaper. The whitepaper should lay out the background, goals, strategy, concerns, and timeline for implementation for any blockchain-related project. Whitepapers can be incredibly revealing: companies that have a flashy website may reveal they lack a fundamentally sound concept. On the other hand, a company with a website containing spelling errors may have a whitepaper that indicates a rock-solid concept and a carefully conceived implementation plan.
- It it sounds too good to be true, it probably is. The idea of getting rich quick on an investment in a hot new project sure is tempting. Keep an eye out as you look for new investment opportunities in the ICO and cryptocurrency spaces. Spend time scrutinizing every detail, and assume that the absence of a piece of crucial information may be an attempt to hide an unsound model or concept. Look for outside sources to verify the legitimacy of any project before making an investment.
_______________________
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We thank you for your support !
CryptoCheck
PANCAKESWAP:CCHGUSDT_A8BAB1 BINANCE:LUNCUSDT BINANCE:LUNCBUSD KUCOIN:FTTUSDT BINANCE:BURGERUSDT MEXC:PPIZZAUSDT OKX:BLURUSDT OKX:PITUSDT BYBIT:BTGUSDT
$ALBT the scam that kept givingI'm doing this chart to be extra petty for all the intelligent individuals of the $ALBT community who kept harasing me
and taking cheap shots at me on twitter because i made a chart regarding the retracement of $albt, with them
believing that $albt would just go up in a straight line forever. So you had a bunch of ppl from that community
blowing up my notifications, saying my TA was trash, retweeting , and making snarky comments even when i was ignoring them.
So with that being said keep that same energy.. life comes at you fast. Karma is real 🤣🤣🤣🤣. 👌
OP Price will go down entire 2022Only 10% of the total supply is unlocked and in circulation. The project is trying to push price up to sell them in high price before token unlocks happen in late May.
There is a big unlock in May. The more token is released, the lower the price will go. Of course, the project owners will try to keep it high so they can make more profit.
Optimism is Genesis related project. If you check the other projects in Optimism ecosystem, You will see that Genesis have the custody of tokens for many projects.
They are programmed to be a scam project.
But of course, be careful with your shorts, because the supply is so limited and its controlled by the manipulators. They can easily manipulate the price.
If I see the price of OP 5$ in a night, I wouldn't be surprised. But the destiny is certain. OP price will eventually end up under 0.4$ this year..
Why the INNOCENT traders always get scammedI received a very important question from a dear member named Bakang. He asked
"Why do people who show the most dedication are the ones who gets scammed most of the time".
Now, I have given an indepth answer with certain reasons and a book I wrote, because of how important this topic is...
Please read it and share it to your friends, family and groups. You just might be helping them avoid being scammed themselves.
Here is my answer:
Thank you for your question and it is a very common problem in society.
There are many reasons why innocent people tend to fall for scams when it comes to the stock market and other high promising schemes.
Reason #1: Humans are just too trusting
Humans have a tendency of trusting the fellow man and believing in the greater good of them. They read about how they’ll make fortunes with them using secretive and insider information – and they make you feel a part of something.
Then as soon as they have your money, they leave you and head over to the next victim like a snake in the grass.
Reason #2: Hot next thing
Every scammer tries to outwit another scammer’s intention. They see what one scammer is offering and they make even more false promises, lies and tendencies.
Then the innocent person is lured in because they don’t want to MISS this ‘once in a life time opportunity’. This has been happening for thousands of years, and human nature is unlikely to change.
Reason #3: Being persuaded by top marketers
The biggest type of scammer is the loudest, most charismatic and they show off things that they don’t have. Or the money they do have it’s from the people who have been scammed.
This is where you read the loudest promos, false and misleading information and advertising.
Also, my favourite is where people read FAKE testimonials with life stories on how something changed their lives…
Reason #4: Fear, Greed and Ego
Most people who are scammed fall for the two big sins of life. Fear and Greed. They fear to miss out on these opportunities and fear that it will never come again.
They have greed where once they’re lured in, they believe in it and deposit a lot more money having this undeniable faith they will be rewarded.
EGO is the one that is hardly spoken about but I think it’s equal to fear and greed.
Ego is where they refuse to believe it’s a scam. They believe they made the right choice joining them and where they want to prove to everyone, he/she was right and they were wrong.
Reason #5: Lack of education
The first way people are scammed is when they don’t have the starting education and understanding of the true and real principles that come with the venture they’re in. They think, because they have money they will win.
But when you dig into the actual principles and education, you’ll realise that there is and has never been a get rich quick way into anything. Everything requires risk and probabilities to achieve some kind of reward in the medium to long term.
Other reasons!
There are other reasons like feeling desperate to do something, acting urgently without thought, being persuaded by others and believe wrong and false information on a website.
It is up to you and me and all of us to better educate ourselves, avoid any scams and to choose the right people to trust and learn from…
Hope this helps and feel free to share this to spread awareness to fellow traders.
Trade well, live free.
Timon
MATI Trader (Trader since 2003)
Short SRM till it gets delisted!!! Hello Padawans,
Risky short entries are yellow lines according to fibs,
#QuickScalps
Almeda Research has 2.2Billion worth SRM while the market cap of SRM is nearly $100M.
#DYOR and manage your risks cause #SRM has a very small market cap at this moment.
Cheers!
Crypto101 - How to spot a scam 👀Hi Traders, Investors and Speculators 📉📈
Ev here. Been trading crypto since 2017 and later got into stocks. I have 3 board exams on financial markets and studied economics from a top tier university for a year.
Hundreds if not thousands of new cryptocurrencies launch monthly. All with big promises of use case, flashing tech and a stock-standard wide mouthed YouTube guy telling you how high it will moon. With these new tokens and coins also comes many initial coin offerings (ICOs) that are often scams. The demand for these have grown, even despite the fact that many people get rugpulled. This mostly unregulated market makes for a perfect place to scam innocent people out of their money, with little consequences to the thieves. When it comes to cryptocurrencies, one of the biggest challenges for investors is not getting caught up in the hype. Digital currencies have quickly risen to prominence in the portfolios of many retail and institutional investors. At the same time, people are still shocked when something like the recent LUNAUSDT / TERRA happens.
Let's discuss a few ways to navigate this wild west market:
- Research the team. Perhaps the single most important success factor for any ICO or cryptocurrency is the developers and administrative team behind the project. The cryptocurrency space is dominated by major names, with superstar developers like Ethereum ETHUSDT founder Vitalik Buterin capable of making or breaking new projects simply by having their names listed on a development team. For that reason, it's increasingly common for scammers to invent fake founders and biographies for their projects.
- Check the whitepaper. The whitepaper should lay out the background, goals, strategy, concerns, and timeline for implementation for any blockchain-related project. Whitepapers can be incredibly revealing: companies that have a flashy website may reveal they lack a fundamentally sound concept. On the other hand, a company with a website containing spelling errors may have a whitepaper that indicates a rock-solid concept and a carefully conceived implementation plan.
- It it sounds too good to be true, it probably is. The idea of getting rich quick on an investment in a hot new project sure is tempting. Keep an eye out as you look for new investment opportunities in the ICO and cryptocurrency spaces. Remember that projects sounding too good to be true , likely are. Spend time scrutinizing every detail, and assume that the absence of a piece of crucial information may be an attempt to hide an unsound model or concept. Look for outside sources to verify the legitimacy of any project before making an investment. Ask questions that you can't already find the answers to.
Now, the project on the chart - BURGERUSDT . BurgerCities crypto was developed on the BNB Chain ecosystem and is now linked to MetaFi . People compete for rewards on the BurgerCities platform. BurgerCities transitioned from being a DeFi product available on the BNB chain as Burgerswap to integrating DeFi and NFT into a more expansive metaverse space, producing uniform and standardized Web3 behavioral metaverse universe. Being a metaverse-oriented project, BurgerCities supports the NFT concept making it possible for users to earn returns through gameplay.
Don't get me wrong; I am not stating that Burger coin is a scam - I am merely pointing out that you should always do your due diligence research on new coins / projects, and be extra cautious when the coin / token has a funny name.
_________________
👀 Follow us here on TradingView for daily updates and trade ideas on crypto , stocks and commodities 💎
👍Hit like & Follow 🔔
We thank you for your support !
CryptoCheck
A laughable marketing scam This is the saddest most picturesque chart of a crypto marketing ploy gone wrong.
Buy wholesale shit from china and we will give you crypto back instead of cash back and if you StAkE it, you will get even moar! UwU
Smelled the bullshit from this project a thousands of miles away after it came across my twitter feed.
FLUX Fell Off a Cliff. Now What?! Potential 30% spike.BINANCE:FLUXUSDT is another hype crypto that is probably another scam. Regardless, the chart shows a technical setup that can return 28% once confirmed by breaking above the ascending triangle reaching a target of $2.168. At the same time, we see a unique RSI pattern. There are three lows in price aligning with three lows in RSI which I have marked with vertical lines. The first two lows show RSI divergence which is a sign of reversal. The third low in price shows a higher low in RSI which is confirmation of the reversal trend. On top of that, we see an ascending triangle forming. The triangle is not confirmed because it needs 3 touches on each side. Currently, each side has two touches only.
Conclusion: We wait for the triangle to be confirmed. Then there is an obvious trade set-up.
$REQ SHORT!!! DAILY CHARTPrevious i made a chart of REQ in 4hour chart, this one is daily chart. The other 2 charts worked out perfectly & this will work out to only thing is patiently waiting... Good luck
$REQ SHORT!!!With this pump and dump coin all you need is patient & wait till it hit the buy area (very soon) and of corse after a major dump there will be correction to upside before the dump continues... It's very sad binance have not enabled the futures options so we cannot short so we must work like this for now!
SELL USDT BEFORE It gets blacklisted everywhere!!!! NOW!If you're not a crook and have assets in Tether, Move them to ANY coin that's half decent. Bitcoin is the safest, Ether ETH is next. Heck SHIB is even a safer bet!!!!! LOL
Seriously! This toxic cryptoscam is getting delisted in Canada. To be a legal, regulated crypto exchange in Canada, you can no longer trade this fake USD. That's a effectively a double fake USD with debasement!
Check your crypto trading platform. Is USDT still there? If so, you'r coins are not in custody with a very safe custodian because this appears to be regulated at the World Level.
Bitfinex and the crooks can safely stay in the Britsh Virgin Isles. No heat there... LOL
Did BSV die after losing the uptrend?AB=0.61 XA
BC=1.41 AB
tp1=0.78 XA=$40
tp2=1.27 BC=$35
tp3=2 BC=$8
XRP:BTC Divergence. You may Want to Read ThisSo my previous chart I explained the market cap and dilution issue I have with XRP, Here is a chart over a 5 year period showing the divergence in bitcoin and XRP and how dominance has changed relative to the dollar.
At first XRP was Trading stronger against bitcoin relative to the dollar, but as time progressed, XRP ended up trading weaker against bitcoin in comparison to the dollar. XRP has a great marketing campaign, but Bitcoins halving is highly deflationary, hence the massive jumps in price. When its all said and done, the change in dominance, diluted supply, and over valuation of XRP...... I wouldn't touch this crap. Buy Bitcoin
