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How To Identify Cryptocurrency and ICO Scams

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Undeniably, cryptocurrencies and ICOs have set a new trend of investing in the global financial markets with unprecedented growth in its popularity witnessed over the last two years. However, the dark clouds of several scams hovering over the cryptocurrency and especially the ICO-market have created a lot of negative impression for this space among retail investors.

The latest report from CNBC reveals an eye-popping statistics of more than 800 cryptocurrency coins released in the last 18 months are now dead. Dead Coins, a website that keeps track of all the failed cryptocurrency and ICO projects, have identified these 800 scam projects under the categories of ‘Deceased’, ‘Hack’, ‘Scam’ or ‘Parody’.

Some Biggest ICO Scams of 2017 and 2018

With a growing number of ICO scams being reported, the U.S Securities and Exchange Commission (SEC) intervened to clean up this space further and protect the investor’s money from being wasted in fraudulent schemes. Here is just a glimpse of a few ICO schemes that managed to siphon off millions of dollars from the investors.

Plexcoin — A ICO claiming for Visa collaboration with a better Bitcoin concept ($15 million funds raised), Centratech — An ICO promoted by celebrities like DJ Khaled and Floyd Mayweather ($32 million USD), Onecoin ($300 million USD). Arisebank ($600 million USD), and many more.

In spite of multiple scams being reported, the ICO market has witnessed a very steady growth over the last year. As per the popular website CoinSchedule, ICOs in 2018 so far have already raised over $13 billion against the $3.8 billion raised in 2017.

Spotting the ICO Scams

Investing in ICOs is certainly not a bad or wrong thing, but it needs a lot of efforts in choosing the right ones wherein one can capitalize on their investments. Before parking your money in any ICO project, you must scrutinize all the details minutely and check for possible hints of frauds. Some key areas to be observed are:

• Knowing the Team: One must check the credentials of the entire team behind the ICO project as well as the advisors. One must dig deep into their past experiences with crypto projects or other financial instruments.

• Long-Term Goal: Check whether the project or the idea is working towards a long-term goal. This way you can ensure the quality of the ICO and the stability of your investments. A project promising boisterous and overwhelming returns in the short term is a big hint towards being a Ponzi scheme.

• Check Whitepaper: Search for all the key information you must have as an investor. Check the project roadmap as well as important things like softcap and hardcap in the token sale. Moreover, keep a tap on the progress of the ICO project as promised in the whitepaper.

Seeking Help of the Professionals

Sometimes it might not be easy for new investors to spot the potential flaws in an ICO project. Such investors should consider seeking the help of professionals in such case. The OZEX platform is one such platform that offers professional services for investors to chose the right ICOs available in the market while distributing their investments across several quality ICO projects.

The @OZEX platform is developed by professionals who are experts in the crypto and ICO market. The OZEX platform offers its wallet services along with other features like smart contracts to help customers efficiently manage their funds.

The OZEX platform invests in verified ICOs using its own OZX tokens. OZEX is currently undergoing through the second round of its ICO and plans to list the OZX tokens on global crypto exchanges by the end of August 2018.