Different Crypto Scams in DeFi and how to identify them.
Day in day out, people keep falling for crypto scams, those who are known in crypto and those who are still novice in the system, and its not showing any sign of stopping or reducing anytime soon, infact its becoming alarming and outrageous in DeFi space, whereby anybody could come up or create a token, give it a weird name, add liquidity, launch it, wait for people to buy and then rug pull when feel satisfied.
Me included i have fallen for the gimmicks of crypto fraudsters but not too much though because i have always been very careful with my funds, well I'm not a millionaire that can part ways with millions and not feel it, so i cut my clothe according to my size. Aside this a lot of people are been defrauded everyday especially in crypto space.
Recently in decide to try to go fully in DeFi coins and i started with Binance Smart Chain tokens, trying to bring out my own strategy, don't laugh at me, i lost my $15 into it, but its all fine because i tried with an amount i could afford to lose, i kept been rugged each time i buy new token that has just been paired, after few minutes the token liquidity will be pulled out or the owner of the token will rug pull the project majorly by selling the large of the token.
SOME WAYS TO IDENTIFY TOKENS WITH POSIBLE RUGPULL
When owner is Anonymous: This should be the most important thing at first, as a project owner to be known to the world and investors at large, when a project owner is anonymous, it should send a lot of message to the investors that something would not be right with the project, because its just like having a company and not coming out to claim your business, how would investors trust in your company. So to be on a safer side in crypto space, one needs to know the project owner and who he is, even though that is not enough to be assured one is making good decision, but its still a go ahead thing before buying or investing in a token.
When token name looks fishy: This is the most funniest thing ever in crypto space especially in DeFi, I've come across different names and i find it so crazy specially in Binance Smart Chain space, and the latest one i saw today was WW3 (world war 3) token on SmartBCH, immediately i sensed something is coming up with the token , i just looked over it because every smartBCH token always comes from someone we know that has been in the community for some time and trusted. These kinds of project or tokens always come up when an event comes up, trying to mimic a trending coin or go with what's in vogue, but it can easily be tracked, hence very risky investing in them.
When the owner doesn't have knowledge about the project: Have you come across a project and you try to ask some few questions about the project from the admin or the owner of the project but he/she fails to give accurate answer regarding the question asked? with that you should smell a rug pull or scam project, so be wary of this. If one is investing in a DeFi project, one should do a due diligent on the project, get the best possible way to the reach the admin or the owner and ask few questions to know if you are dealing with the right person or people.
When the token is not sellable: Actually this was my first experience when i tried top go fully on DeFi space, and i went straight to Binance Smart Chain, i bough a token and before i knew it i couldn't sell it, i tried different slippage yet i could not sell the token, then it was rugged, it was really painful. So this should bring us to the fact that before investing in a token one should check or tract the token if its sellable before delving to avoid losing money to scammers, mind you even if the token is sellable doesn't mean it cant be rug pulled, so we must do our own research before hoping in.
When the token is honeypot: What we mean by is when a token project investors money is tied down or trap the money invested not allowing investors to withdraw their money, more or like a trap. The best way to see if a token is honey pot is to tract it, and most especially check the trade history, if there is no much sell off, then know its an honey pot token, these token with honey pot seeks to trick their victims into falling into traps, they send out contracts address that appears to be sellable but sure contains hidden traps, so be wary.
Thank you all for reading and looking out for more article from me, investing in DeFi token is very interesting with good returns but at the same time one needs to be very careful which token to invest in so as not to fall victim of being scammed.
