The entire world seems to have gone 'crypto crazy'. The popularity of cryptocurrencies is undeniable. With digital currencies like Bitcoin and Ethereum being all over the Internet, more and more people are jumping on this crypto bandwagon for many reasons. However, in this exciting but still lawless and unregulated world, users can also become victims of crypto scams.

Experts at PointPay, a beginner-friendly trading platform, believe that security is one of the most important considerations. Traders should always consider the security and protection measures offered by any exchange before they start using it. As a centralized exchange, PointPay doesn't provide private keys to users due to security reasons and highly recommends enabling both types of 2FA verification. What is more, we are always doing our best to keep our users up to date and share useful tips on how not to fall prey to fraudsters.

PointPay experts recommend traders and investors fully understand the risks surrounding cryptocurrency. As you're already familiar with some common cryptocurrency scams we were writing about, we want to share more tips and rules to help you trade crypto and stay safe.

Manage reputation risk

Reputation risk is a term that describes factors that can affect the project's reputation. It is the threat that a company may not be in good standing and may potentially have founders or developers with bad intentions. Therefore, it is crucial to do your best to determine if the project's founders are trustworthy before investing your money. Previously, some of the best projects were led by anonymous founders who wanted to protect their privacy, and this is understandable. However, many are now realizing that confidentiality only raises suspicions.

Be wary of popular "pump and dump" and "rug pull" schemes where developers abandon their projects and disappear with investors' funds. Unfortunately, such situations are widespread in the crypto space.

In addition, social media influencers and media personalities can be paid to pump tokens or projects. Never make an investment decision just because someone famous on the Internet says it's a good idea. PointPay experts are sure that the hype in social networks often leads to a loss of money.

No crypto scam. Do your best to keep your wallet safe

With so many cryptocurrency wallet options on the market, many experts believe it is better to store your Bitcoin on a hardware wallet. They don't connect to the Internet, so crypto scammers will definitely have a hard time trying to access your private keys. As for your private key, you should also store it offline. Simply write it down on a piece of paper and keep it in a safe with other documents, or in any dry, protected from heat place.

Don't forget to use a secure Internet connection, and most public networks have security flaws. The best thing to do is to use only home networks. Also, use good and up-to-date antivirus software, don't click on unknown and suspicious links, and come up with a strong password if you use an online wallet.

Experts in the industry also recommend creating a separate wallet that you can top up anytime you need for your day-to-day transactions.

Check the smart contract

Smart contracts are collections of code that carry out a set of instructions on the blockchain. They are essential for most cryptocurrency projects to run.
Smart contracts can be quite technical, so it's worth asking someone knowledgeable to check the code. You should know that if there is an issue with a code, there could also be weaknesses within the project.

For example, more than $600 million worth of crypto was stolen in a cyberattack that targeted a decentralized finance platform Poly Network. PointPay experts might conclude the attacker was able to exploit an issue with the coding of the network.

It is worth taking your time and looking only for projects that take safety precautions and are well-audited. Pay attention to apps that don't share their code or ignore security concerns. When in doubt, it is better to talk to more objective community members or someone with the technical expertise to review the code thoroughly.

Stay cautious and investigate with PointPay

PointPay experts always say traders and investors should take time to research before investing. Start by looking into a project's official website and where it's available to buy their tokens. Then, check out the white paper and all the information about developers and founders. Of course, these attributes aren't the only markers of whether a project is trustworthy or a crypto scam, but they can still be helpful. What is more, you can also follow the PointPay Medium blog to learn everything about cryptocurrency scams and tips on how to avoid them.

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