Just like cryptocurrencies have brought riches to thousands of people, there are some frauds that have taken people from riches to rags. This is no joke, and this is why we are going to talk about the greatest cryptocurrency frauds of 2021.
On top of that, we are going to give you advice on how to spot potential frauds and how to administer your investment funds efficiently. Come with us and learn before you buy ethereum or bitcoin and invest in a fly-by-night blockchain project you need to .
How many cryptocurrency frauds have taken place?
Only in 2020, the US saw more than 80,000 cryptocurrency frauds. That’s an alarming number and we are sure that it will keep growing with the rising popularity of cryptocurrencies. This happens because, just like any other booming industry, there are always shady characters trying to make money in illegal ways.
According to the FTC, the number of cryptocurrency scams has grown by more than 1000% versus 2020. It has caused people to lose over $80M USD. With so many new investors who are not immersed in the industry, it’s easy for scammers to lure them.
As we can see, the crypto sphere is being attacked by frauds and scams. Now let’s talk about the most scandalous frauds of 2021, and then we will teach you how to prevent yourself from being another victim.
What are the most scandalous frauds of 2021?
Here you have the ranking of the absolute most scandalous crypto frauds of 2021. Here you will find all about the projects that scammed their investors – here’s how it starts.
The Pancake Bunny Exploit
A hacker or a group of cybercriminals spotted weak points in the Pancake Bunny project that allowed them to execute a flash-loan attack, which caused a massive loss of $1B dollars. Evidently, this completely ruined the price of the cryptocurrency and generated huge losses to investors all around the world.
The Fairmoon Rug Pull
Fairmoon has been another major crypto fraud in 2021 because it made investors lose millions of dollars. Simply put, the team ran away and rug pulled all the investors – which has become a common tactic among these fly-by-night crypto projects.
The Titanium Token That Rug Pulled Mark Cuban
Whe the Titanium token went from $60 to $0, it also crashed the investments funds of thousands of investors including the billionaire Mark Cuban. The team behind DeFi scam cashed out all the funds before collapsing and abandoning the project, leaving all the investors holding nothing but a heavy bag of nothing.
Bonus: The scam that wasn’t – DeFi 100
This apparent $32M scam took the BSC (Binance smart chain) community by storm. Fortunately, the developers didn’t run with the funds as the message on the website claimed they did. The website was hacked. However, even though they didn’t scam their investors, the lack of security protocols completely ruined the reputation of the project. When the projects have so serious problems, the crypto prices tend to crash.
How can you spot potential frauds?
The frauds keep rising, and hence, you need to learn how to spot them. Below, find the main indicators that indicate that a project might be a potential scam:
- No team: If the project does not have a visible team behind it, then just run. Chances are they remain anonymous because they want to scam the investors and run away with the money
- Too much marketing: Every blockchain project needs a marketing plan, but if their only focus is marketing to attract more investors, then that’s a major red flag, especially if they don’t have an actual product or roadmap
- No clear product: This is a red flag, because if they don’t have a product or solutions to solve the problems they state, then you can tell they are in the business just to steal your money. Run away and don’t look back
- Ridiculous white paper: if the white paper makes unrealistic claims with no clear basis, then you can tell it’s a scam, especially if it focuses too much on ROI
- Too much focus on ROI: If the project states that its main strength is the huge potential ROI, then just run away. They are here to steal your money because they don’t have any real product.
Always watch out for these red flags because they are enough to let you see if a project is good or not. Any of these signs are a clear indication that they are only looking forward to rug pull you!
The crypto sphere is being attacked by these scams and frauds. Follow our tips to remain safe, so you can protect your funds and invest them in worthy projects that might bring you a good ROI by actually delivering usable products and services to the market.
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