How scammers convince people to invest in their scam projects?
Updated: Sep 9, 2019
Many crypto traders, enthusiasts and investors have been scammed in recent years. Not all the victims of scam cryptocurrency projects are newbies and beginners. There are lots of informed, experienced and professional crypto traders that also lost huge amount of money because of scam projects.
In 2018 alone, losses from cryptocurrency-related crimes amounted to 1.7 billion dollars. Lots of people with the hope of investing in promising projects lost their money. These criminals offer mind-blowing ideas related to blockchain that every technology lover could be obsessed with. Some of the ideas may seem realistic, but criminal use that as a trap to attract people, get their money and run away!
But how can an investor be sure about what they are investing? Of course Not all ICOs and cryptocurrency projects are scams but you have to keep in mind that in recent years lots of cyber crime masterminds entered the cryptocurrency projects world and stole investors’ money by promising them some falsehoods.
First: Show an impressive picture of the project
What is the first thing you hear about a project that is very important both for potential investors and project owners? Offering a bright vision a scam project which is technically complex is a good way to convince tech lovers. These kinds of potential investors love complicated technologies even if they do not have a clear understanding of it. Scammers use this trick to offer a tangible product in combination with complex blockchain-related technology.
Second Tactic: Target people’s greed
These people use both old fashioned and new tactics to convince people to invest in their projects. They target people’s greed, they picture an attractive vision of their projects to people and promise them huge returns. They start talking about the scam project through group chats on Telegram or WhatsApp, forums and other social media platforms. Then they encourage trapped people to play the role of firs layer actors on for their word of mouth marketing strategy. Then they promise high rates of return in exchange for inviting people to participate in the project.
Third Tactic: Bigger lie, Better
When people are attracted to a project, scammers start to talk about big visions, big plans, and bigger lies!
At this stage, they know that some people are interested in their project because till now they did not recognize their real intention. So this is the stage when they start telling bigger lies about the future of the project and how profitable it would be!
Fourth Tactic: Big Names
Like all modern marketing campaigns, influencer marketing plays a big role in scam project campaigns. Scammers somehow use big names to convince people to invest in their projects. You may not know but big names like Dwayne ‘’The Rock’’ Johnson, Justin Timberlake and Christopher Walken appeared on some videos supporting a scam project called ‘iCenter’ which they claimed that there were edited videos without their permission.
Fifth Tactic: ICO (Initial coin offerings)
At the moment ICO is one of the most popular scam techniques for scammers all over the world. ICO is a crowdfunding wat for startup cryptocurrency companies to raise money from its future users in exchange for sending the users active and trustworthy cryptocurrencies like Bitcoin and ETH.
Investors should be aware of ICOs. ICO is the best way for scammers to take money from people and run away. In some cases, scammers use a lot of media coverage, renting fake luxury offices to attract people to the projects. They also show fake statistics about their ICO sells which could convince people that lots of people are buying it, why not me?!
So be aware of these techniques which scammers use to take your money!