Beware of crypto scams: how to protect yourself
- August 14, 2023
- Posted by:Muriel
- Categories:Bitcoin, Cryptocurrencies
Scams, phishing, fraud schemes or denied access to one's cryptocurrencies - these terms are unfortunately found in many crypto headlines.
As cryptocurrencies are steadily growing in popularity, this is also attracting organizations to target fraudulent crypto projects in order to reap a lucrative payoff.
With this article we would like to show how to protect yourself from which scams:
...are illegal business models in which new participants are enticed to deposit money or buy products in order to achieve high returns. These systems are based on the deposits of new participants and not on real products or services.
...are scams where fraudsters try to steal confidential information by posing as trusted companies or people. They use fake emails, websites or phone calls to deceive their victims.
Dubious crypto exchanges
...are exploiting the growing popularity of cryptocurrencies to defraud capital investors. These exchanges may be fraudulent or have inadequate security measures, which can lead to hacking and losses.
To protect yourself from such scams, it is important to trade on established and trusted crypto exchanges. Moreover, it is necessary to research thoroughly, read reviews and set security measures such as two-factor authentication and use secure wallets. If a spontaneous contact by email or phone occurs, be skeptical and do not disclose any information about your personal data and even less any assets on the advice of this unknown person. Also, requests such as remote access to your computer is another reason to break off contact. Basically, it is advisable to only invest money in cryptocurrencies that you do not rely on and to keep yourself updated on the best security practices in the cryptocurrency world.
Alternatively, a reputable asset management company can help:
Advantages asset management
Security: Asset managers use advanced security measures to protect cryptocurrencies from theft or loss. These include hardware wallets, multiple signature procedures, and secure storage systems.
Expertise: Asset managers have expertise and experience in cryptocurrencies. They have experts who monitor the market, perform analysis and assist with portfolio management. This allows them to make better investment decisions and maximize return potential. Likewise, this gives you a direct point of contact to whom you can turn for second opinions on personal crypto investments before investing in something that sounds too good to be true.
Diversification: asset management helps to diversify the cryptocurrency portfolio by considering different cryptocurrencies and possibly other asset classes. This reduces the risk and allows one to benefit from different market developments.
Convenience: Custody and management of cryptocurrencies require technical expertise and time. Delegating these tasks to an asset manager allows you to focus on other important issues. The asset manager takes over the administrative work and ensures smooth processing.
Disadvantages asset management
Costs: The use of an asset management for cryptocurrencies is associated with costs. As a rule, fees are incurred, either as a fixed fee or as a percentage of the invested assets. These costs must be taken into account when making an investment decision.
Dependence on third parties: If cryptocurrencies are held in custody with an asset manager, one is dependent on the availability and reliability of the asset manager's custodian. Disruptions, technical problems or even bankruptcy of the custodian can affect access to cryptocurrencies.
An informed decision about whether to engage an asset manager should be based on weighing these factors.
Overall, it's important to stay vigilant, stay up to date on scams, and make informed decisions to minimize the risk of cryptocurrency scams.
Although we have made every effort to carefully research and verify the information in this article, the blog posts are neither an offer nor a solicitation to buy or sell investment or other specific products and cannot substitute for personal advice from a financial, legal and/or tax advisor. The content in this post is for general information purposes and therefore does not constitute investment advice. No liability can be accepted for decisions made on the basis of information in this blog post.