Crypto Opportunities Aren’t As They Seem: 5 Crypto Options To Stay Away From
With the drops in Bitcoin value and the many regulations being put in place by other countries, it is safe to say that crypto has yet to reach the safe level. In fact, hackers and scammers have made the industry even more unsafe and risky. Even though there are plenty of risks involved with embarking in any new financial venture, there are five specific ones to look out for.
Hard Fork Mania
This is one of the opportunities that took on Bitcoin, even though it started falling in 2017. When smaller coins promise a fork, they offer just as high of a risk. Even suggesting a hard fork can cause the price to spike, even without a new asset. However, a hard fork is simply a system update that comes with a lot of hype.
There are plenty of projects that started as an ERC-20 asset, though the transition to their own platform is usually when the company makes the most revenue. However, for projects like DADI, the MainNet launch can still fall flat. Some cryptocurrency platforms get consumers excited about the project and then no additional support ends up coming later one. There is no promise that there will be an improvement in value, even with a spike in the price temporarily.
In any industry, getting something for free is a great deal. Airdrops allow consumers to claim plenty of free coins in a single swoop, but they can also be risky. While some airdrops are beneficial and legitimate, the promise of free coins in circulation can actually lower and nearly bankrupt a cryptocurrency. The free coins essentially have no value, and a coin with no value is worthless.
Hope to Pump
Rather than pulling the wool over the eyes of investors, some traders are blunt – they want coins that give short-term profits. They have no plans for ongoing trading and they primarily want to get funds as fast as possible. Anyone that is new to trading wants to stay away from these opportunities entirely, because the surge in value may never occur. When looking at coins that have a history of frequent pumps, it may be best to stay away.
Overhype About the Coin
There are plenty of companies that promise to solve major problems in their industries and others, but big claims usually come without any follow-through. Some of these platforms are even considered Ponzi schemes. Even though there are no guarantees for any investment, it is a good rule of thumb to be skeptical about promises that are too good to be true.
Most projects take several years to get off the ground and prove themselves to be thriving options. However, that leaves investors behind the opportunity to invest at the beginning, unless they are willing to take a risk. It is a “buyers beware” kind of market, and consumers should pursue thorough research about the validity of any team and the ways that the company will keep itself going. All of the above opportunities have had times when they actually are valid but putting too much hope on specific events may lead to loss.