How to Spot a Crypto Scam • Ponzi Coins • Benzinga Crypto
Some of the most promising technological, economical and political advancements are currently being developed by the blockchain and cryptocurrency industry, yet the technology is still not well understood by regulators and the general public. As a result, scammers across the world are taking advantage of the novel technology to prey on uneducated consumers.
Here’s a short guide to spotting these types of crypto scams, as well as a brief overview of the industry and its technology.
How to Spot a Ponzi Coin
Ponzi coins like SafeMoon, Baby Doge Coin and FEG token require users to pay a redistribution or reflection fee for selling and sometimes transferring coins. These coins typically live on the Binance Smart Chain, although many are based on Ethereum. Usually, a portion of the fee is “burned” or removed from circulation. By doing this, projects claim to be revolutionary “deflationary” currencies…