Crypto: The Dark Side
By Moni Talks Chairman and Founder Brendan Beeken FInstSMM
At Moni Talks , we believe in decentralised finance and see it as a major benefit to the future. However, as I’ve said many times before, there are risks and investors must remain alert and cautious.
The advent of cryptocurrency and blockchain technology has brought significant advancements and opportunities for innovation. However, like any revolutionary development, the crypto industry has also attracted its fair share of bad actors.
These individuals exploit the decentralised nature of cryptocurrencies for personal gain, leading to scams, frauds, and illegal activities.
Staying Safe
Regular readers will know that Moni Talks stands for safety and security in crypto, encouraging education, information, responsible trading, and enforceable, reasonable regulation.
Part of keeping the cryptocurrency space safe is acknowledging there are dangers and then shining a light on them, so participants are aware and able to take precautions.
Turning a blind eye is no longer acceptable if we want to maintain and build the reputation of crypto and DeFi.
So, this week’s edition of Beyond the Boardroom exposes some of the most common scams and frauds, what to look out for, and how to protect yourself.
Ponzi Schemes and Exit Scams
A prevalent form of misconduct in the crypto space is the operation of so-called ‘Ponzi’ schemes and exit scams.
They promise extraordinary returns on investments, often luring unsuspecting individuals with false guarantees. As new participants join the scheme, their funds are used to pay previous investors, creating the illusion of profitability.
Eventually, when the flow of new investors diminishes, the scheme collapses, leaving many people with significant financial losses.
At Moni Talks, we encourage responsible members of the crypto community to share warnings as widely as possible whenever such a scheme raises its unwelcome head, as we do.
Initial Coin Offering (ICO) Frauds
Initial Coin Offerings, or ICOs, became a popular fundraising method in the early days of cryptocurrencies.
Unfortunately, this trend also attracted fraudulent actors who launched fake ICOs to deceive investors. These scams involved creating misleading whitepapers, exaggerating project capabilities, and even fabricating team members. Unsuspecting investors would contribute funds to these projects, only to find out later that the entire ICO was a sham.
Previous newsletters from Moni Talks have explained more about ICOs, the arguably safer alternative IEOs, and the warning signs to be on the lookout for.
Hacking and Theft
Cryptocurrencies can be vulnerable to hacking and theft. Cybercriminals employ various techniques, including phishing attacks, malware, and exploiting vulnerabilities in exchange platforms or wallets, to steal funds.
Numerous high-profile cases have resulted in the loss of millions of dollars-worth of cryptocurrencies, impacting both individuals and exchanges. Although security measures have improved, hackers continue to find new ways to exploit weaknesses in the crypto ecosystem.
Our news service, Latest Moni, regularly reports on security breaches which have resulted in large sums being stolen, from individuals and even large industry players.
We have regularly written about safety steps you can take, including using multi-factor authentication (MFA) and offline, or ‘cold’, crypto wallets to store your coins and tokens.
Pump and Dump Schemes
Pump and dump schemes involve artificially inflating the price of a cryptocurrency through coordinated efforts and misleading information. The orchestrators of these schemes accumulate a specific coin or token, often with low market liquidity, and then use coordinated social media campaigns or other means to create a buying frenzy.
Once the price has reached a certain level, they sell their holdings, causing the price to plummet and leaving unsuspecting buyers with significant losses.
Fortunately, many would-be crypto investors are much more aware of these schemes and we are beginning to see regulators and responsible actors in the sector take action.
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Money Laundering and Illegal Activities
The pseudo-anonymous nature of cryptocurrencies has attracted individuals engaged in money laundering and illegal activities.
Criminals utilise cryptocurrencies to launder money by obfuscating the origin of funds through complex transactions and mixing services. Additionally, cryptocurrencies have been associated with illicit activities such as drug trafficking, ransomware payments, and funding terrorism.
While the majority of crypto users are law-abiding, these incidents have raised concerns and prompted increased regulatory scrutiny. At Moni Talks, we welcome regulatory action that squeezes these unwanted people out of crypto.
Combating Bad Actors
Recognising the need for safeguarding the integrity of the crypto industry, various stakeholders, including Moni Talks, are taking steps to address bad actors.
Governments and regulatory bodies are implementing stricter regulations to mitigate risks and protect investors. As long as the laws are reasonable (to avoid stifling innovation) and enforceable (so they actually do something), we support these efforts.
Cryptocurrency exchanges are enhancing security measures and conducting thorough due diligence to prevent fraudulent activities. There have been many recent examples from Moni Talks, including our partnership with MIRACL | The login you love and joining FINTRAIL .
Conclusion
While the world of cryptocurrency and blockchain technology presents incredible potential, it is vital to acknowledge the presence of bad actors seeking to exploit this innovative space.
Awareness, education, and robust regulatory frameworks are crucial in safeguarding investors and ensuring the long-term success of the crypto industry. By staying informed and remaining cautious, users can navigate this dynamic landscape with greater confidence, contributing to the development of a more secure and trustworthy crypto ecosystem.
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Best Books on Cryptocurrency to Read in 2023
By Tom Nyarunda for #LatestMoni
For most people, the crypto subject feels cryptic, if not occult, with only a few with technological superpower minds claiming perfect knowledge.
While getting overwhelmed by the peculiar new coins emerging, jargon and terminology is easy, the crypto sphere doesn’t have to be perplexing and overpowering.
This article describes the best books on cryptocurrency by experts on the subject you can opt for…Continue Reading