4 min read
Though you scroll through investing news on your phone every morning, checking the stocks as you stir your coffee, you’ve been a little leery of crypto. You’ve heard a lot of hubbub about people being taken advantage of, or outright scammed. Yet, you’re even more leery of leaving money on the table. And at this point, you know that crypto is here to stay. Time to get started — but safely, of course.
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Fortunately, there are ways to start investing in cryptocurrencies that can limit your risk of being scammed. GOBankingRates chatted with some experts to find out more how you can dip your toe into crypto investing without getting taken away by the current of fraud.
As the co-founder of the crypto growth platform Galxe, Charles Wayn knows how to spot solid crypto projects. His biggest tip for anyone looking to invest in a crypto project is to find one with a large, active and well-established community around it.
The same high standards you’d apply to any other company you’d invest in — like the quality of the products and projects, its track record of success, as well as the reputation of its leadership — are also applicable to cryptocurrencies.
“Reputation and credibility are as important in crypto as anywhere else; as is what the project itself does, the utility and value it’s offering, and its track record in terms of business operations and leadership,” he said. “In short, a good crypto project is not unlike a good company or a quality product and will pass all the same levels of consideration and due diligence.”
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What is that old saying about wearing rose-colored glasses? Oh yeah, they keep you from seeing the red flags. According to Brian McGleenon, crypto expert and global head of news at BeInCrypto, people who fear missing out on the biggest, most exciting opportunities — and not doing their due diligence — risk putting on those rose-colored glasses.
So, what red flags might they miss? McGleenon said to be aware of things like anonymous founders, unrealistic yields and poor website quality — which should immediately raise your suspicion.
“If it feels too good to be true, it probably is,” he said.
Nic Adams, co-founder and CEO of 0rcus, a cybersecurity firm, concurred with these red flags, and added a few of his own. He wants beginners to be skeptical of opportunities that promise high returns with little or no risk, which he calls “a foundational fallacy in financial markets.”
