Chapters
- 01. Educate Yourself
- 02. Do Your Own Research (DYOR)
- 03. Don't Believe Everything You Read
- 04. Keep Your Private Keys Out of Sight
- 05. Don't Leave Funds Online
- 06. Only Use People and Companies You Trust
- 07. Use Common Sense
- 08. Watch Out For Rugpulls
- 09. Pump and Dump is Real
- 10. Beware of Theft to Exchange Platforms
Bitcoin and cryptocurrency trading got a bad rap and label in Nigeria, Africa and worldwide when trading scams multiplied like ants on a piece of cake. Even today, many Nigerian and African citizens associate bitcoin and other cryptocurrencies with online investment fraud.
At the same time, the lack of knowledge about the blockchain and how to invest safely in these digital currencies is still one of the main reasons new victims of scams are born every day.
Of course, most Nigerian or African crypto investments, or projects involving cryptocurrencies have transparent intentions and. really do pay financial gains. However, scammers often find new ways to scam people, despite the legitimate use and value that most people in Nigeria, Africa and worldwide make of cryptocurrencies such as bitcoin.
So, if you want to know what you should do to avoid being scammed by a person who thinks he is smarter than you, take a look at this guide that shows you different security tips that will help you avoid crypto scams as Nigerian or African traders.
Educate Yourself
You should always start at the beginning if you want to enter the world of cryptocurrencies. It is vital to educate yourself with the investment details first: read about what a cryptocurrency is, what bitcoin is, how it works, how can you know the price, how to buy and sell crypto coins, which cryptocurrency wallets are available, how you can exchange and spend them, the best bitcoin or crypto service provider accessible in Nigeria or Africa for you, etc.
It is also important to understand how the blockchain works and everything else you need to make crypto-related financial decisions.
Also, always do it from a crypto company or website that does not request any kind of payment: the internet is free. Beyond the internet service provider costs, your education should be free unless you want to access a more specialised course from a university or educational platform like Superprof. The more you know about bitcoin and cryptocurrencies, the lesser scammers can scam you.
Do Your Own Research (DYOR)
It does not matter what the crypto project is. If you are going to invest in it, you must know even the smallest details, from its operation to who runs the company or business. If you have the project's white paper, don't skip reading it. When a white paper is just a copy of another crypto project, it is most likely a cryptocurrency scam or simply has no future at all.
Now, if it's a service provider like an exchange company or a payment platform, look into that as well. Look for reviews, analytics, complaints, recommendations, and other relevant details from other Nigerian people who have used the provider or company.
Also, keep up to date with the news about it: many exchange houses or crypto investment companies on the verge of bankruptcy after a massive hack choose to keep their users' funds, for example.
Here are some examples of crypto scams you should know about.
Don't Believe Everything You Read
Even if the crypto investment offer looks legitimate, leave room for doubt and pay attention to details. In the case of a phishing URL via email, spelling is often wrong, so check the spelling when you receive an email. Some phishing URL email scams replicate every last detail of another legitimate website but cannot copy their exact website address, domain or URL.
Also, if the company or provider guarantees or promises to offer you high amounts of profits from your investments in a very short time, rest assured that they are fake, and you would do well to label them a fraud. The financial status of the cryptocurrency market is volatile, and nothing is guaranteed.
Even if you read very positive news online about a company or provider, don't believe it until you find the original source. Check if it is reliable or false. Go beyond social networks because there is usually not everything you need to check the integrity of a news item. Check the official website of the company or business involved.
If social media are flooded with positive comments about an unknown cryptocurrency or a new service provider that gives away money, do not get carried away by a trend. Read again and contrast the different data and information you get, because a scammer might be lurking in the dark waiting for you to fall victim.
Keep Your Private Keys Out of Sight
The private keys of your wallets should not be digital or in the cloud. Hackers could take advantage of a vulnerability in your computer or service provider and obtain that vital data that is essential for the safety of your money. They should also not be shown to anyone who requests to view them for any reason. Legitimate bitcoin exchange and wallet services will never ask for this information.
If any problem arises, the support team will guide you without requesting any payment and any data beyond the problem you are presenting. Always keep your crypto wallet details to yourself like you would with your traditional bank account details.
Do not buy hardware wallets like Trezor or Ledger from virtual or second-hand stores. Trust only the methods offered by the seller or the services provider. If a seller or an intermediary has access to the device you bought, you could become a crypto theft victim in no time.
Here are the different types of cryptocurrency scams you should know.
Don't Leave Funds Online
At least not for long. If you are going to trade bitcoin or cryptocurrencies on an exchange platform or deposit in a crypto market, make sure you do it only when necessary and do not leave any remnants there. These platforms are not bitcoin or cryptocurrency wallets - your funds may be at risk there, either from a hack or an eventual exit scam or fraud.
It is safer to leave your funds in your crypto wallet or traditional bank account.
Only Use People and Companies You Trust
There are a variety of scammers disguised as fake exchange houses, bitcoin wallets, traders or other services. This is why it's important to only turn to those who have extensively proven legitimate during their time in the cryptocurrency business or market.
In the case of people you do not know, when transferring funds, trust them only if they are backed by a reputation system, such as the one you can find in LocalBitcoins.
Don't download files from websites that you haven't verified. Fake apps abound on the internet today. One practice that might be useful for you is downloading apps or any other software from official GitHub repositories.
Use Common Sense
If something looks too good to be true, it is too good to be true. Key phrases to identify scams are "100% guaranteed", "100% real", "daily earnings", "No scam", "The new Bitcoin", "blockchain will make you a millionaire", "blockchain technology that nobody knows", "1000 free coins for joining "," minimum investments "," earn cryptocurrencies easily "," I am giving cryptocurrencies for free"," multiply your bitcoins "," risk-free "or" win without investments ".
Nobody gives money to strangers just because no investment is guaranteed, and if someone must insist that something works and is "100%" real, surely it is because it is not. Also, no business works without initial investments, so "winning without investments" actually involves a referral system (pyramid) or hidden costs later.
Always ask yourself the standard questions. Don't release data, information or money until you investigate thoroughly if something looks suspicious.
Watch Out For Rugpulls
This action, which in translation would be close to that of pulling the rug or tablecloth on a table, is another malicious technique used by scammers. In this case, there is nothing false, but one falls from ignorance. This system is based on making tokens with names similar to the important ones, such as BTC, ETH, and DOGE.
Once the scammers have the amount they were looking for, they withdraw the token's liquidity, which automatically loses value or is worth nothing. Thus, in this way and in a matter of seconds, the victims lose everything. There is no need to fear when operating but be very attentive.
When you want to invest in a cryptocurrency, read about the project if a person who is an expert endorses it.
Finding if the cryptocurrency is listed in any of the most important exchanges could give you an indicator if the token is real since to comply with the regulations of various nations and be able to continue operating, the exchanges carry out an in-depth analysis of the new assets that they wish to add to your platform or services.
Read on how to spot fake cryptocurrency news.
Pump and Dump is Real
Although it is not a scam itself, it can make you lose a lot of money in a very short time. As noted, technically, it is not illegal, although it could be treated as unfair. This is when a scammer buys a low-price, low-market-cap cryptocurrency, inflates its price, sells it, and keeps big profits.
This is a coordinated action and what is sought is to bring together as many people as possible so that the value is greater.
Beware of Theft to Exchange Platforms
Even if we do nothing, we can even be scammed. How? Exchanges are one of the common targets of hackers and scammers. They handle millions of dollars in payment and withdrawals, and if they have security flaws, they can lose a good part of their assets.
For this, our best option is to have the money in our own wallets, using either online or physical platforms. Among the former, there are several options, such as Blockchain.com, Trust Wallet or Metamask, etc. The disadvantage of having them here is that the cost will be higher than within an exchange for each transaction.
Within the physical wallets, the best known are Trezor and Ledger. They look like a pen drive, but they have the possibility of storing hundreds of cryptocurrencies. In both cases, you will have to be very responsible because you will be the only one who knows the private key. If you forget or lose it, you may never be able to access our funds again.
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