Crypto Scams Are Always There. Avoid Getting Rug-pulled With These Tips

Cryptocurrency has captured the world’s attention after the pandemic, and notorious scammers have taken notice too. With the rising popularity of altcoins and meme tokens, there will be an upsurge of new crypto scams taking place on Telegram. What is a Scam? Scam, rug pull, you name it. They’re everywhere: Telegram chats, groups, fake communities. But what exactly is a rug pull? The next level. They happen when developers create a token paired with a valuable cryptocurrency, list the token on decentralized exchanges (DEXs), and then pull out all the funds. In simple words, a crypto rug pull occurs when the developers abandon a project after cashing out investors’ capital. Consider the recent “Squid Game” scam where the developers created a ‘Play-to-earn’ SQUID token, drew in buyers, inflated the prices and made off with $3.38 million, according to Gizmodo. How to spot a Rug Pull? Though seasoned scammers create the Rug pulls, it is easy to spot them if the investor pays close attention to the following signs. Low Liquidity Low liquidity means it is difficult to convert the tokens to cash as the developer had limited funds to create the token. It is easier for the developer to manipulate the token’s price when the liquidity is lower. The best way to check liquidity is by looking at 24hr trading volume, which should be at least 20% to 40% of the coin’s total market cap. Low TVL(Total Val...