CRYPTO TOKEN (erc20, bep20) COIN SCAMS 2022 How cryptocurrency fraud operate


April 5, 2022, 9:29 p.m.


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The crypto token/coins scam  review has 3 parts:

1) Token scammers know what the investor wants then fake everything.

2) The scam formula.

3) 2022: trending types of scam tokens.

 

PART 1: Token scammers know what the CRYPTO investor wants: Then they fake everything

Probably 95% of the newly launched tokens (erc20 and bep20) are scams. There is an important machinery behind, that understands the psychology of the average crypto investor and what he seeks. From there, everything is faked. Fake pasive income, Fake communities, fake and paid chats inside, fake comments, fake tweets, re tweets, fake articles, lying influencer's on twitter , youtube, meta, tiktok etc. Fast presales, security audits, locked liquidity illusion, fake linkedin profiles, fake transactions, burning of tokens. everything is a lie made up to take your money. And of course the technological innovation those tokens offer is 0, because it is copy/paste computer code from others peoples work.

 

Fake passive income.

It seams that investors love the idea of financial freedom. The so called passive income or free tokens reaching their metamask wallets in an autometed way. Scammers say ok, lets do it. There is a horde of scam tokens that have the ability to mint new tokens out of nothing calling that staking(the original idea of staking has to do with provision of coins against validating blocks, but the name staking was hijacked and now means mint new tokens out of nothing) high apy protocols , auto compounding and so on. The result is a fast depreciation in mater or weeks/months of the token price in relation to its pair like ethereum or bnb and the erosion of the investors funds.

 

 

 

Tokens Fake Social Communities.

 

 

Token buyers look for strong socials and social activity as a requisite to make a crypto purchase. Token creators / scammers are aware of the fact and pay for fake communities. They are entire teams in different part of the world that offer you services like:

 

Providing members to your reddit, twitter , telgram socials. You do not have to look for them they find you as soon as you launch a token and list it on some charting / voting token place like Poocoin, Dextools, Coinmooner or Booged Finance. Furthermore many of those people that contact the token creators usually through telegram are scammers that would just defraud the scammers. Scammers the scam the scammers, funny.

Many fraud tokens projects have 40.000 or 100.000 subscribers at their launch, how is that possible? By paying, those are not natural communities. Most of the members where auto added.

-Shilling and simulation of activity: Those are people that actually chat in the token scammers telegram channel with other shillers, of course paid. They talk about the token, post memes and all kind of stuff, but mainly convincing people how great the project is. Having a telegram channel with lot of chatting makes buyers think that the project has potential because there is activity and people are actually disusing it. No, it is fake, those are shillers. And they are expensive prices range from 100 usd per day.

 

shilling example on a token in telegram. Look at apple dao created two days ago. In less than 24 hours it had 7400 messages, most of them fake.

 

Offer from a shiller, he claims to have active 50 members.

 

Token fake tweets and followers

 

The same goes for twitter. Imagine 10000 twitter accounts, all crypto promoters that follow each other. Their rules are simple, every time someone tweets about a token project the others retweet and follow the project generating signs of activity, but among them real persons are a minority. Token scammers get lots of followers this way, and succeed to deceive investors, by showing them unrealistically big twitter communities

 

Example of a price list from a twitter scammer GEM „#NFT” Hunter 

 

Youtube , Tik tok Influencers and influencers in general

 

So you want to buy a coin, but you first search youtube to see if they are many results as a proof it is not a scam? Let me tell you most of influences don't care if a project is a scam as long as they get paid by the token creators. They would say anything just to get paid. The number of results will be proportional to the funds token creators had spent on youtube.

 

The myth of locked tokens.

Some investors feel safe when they know that a certain token has locked liquidity, because they think that if locked by some webservce company liquidity can not be withdrawn(this is an advanced concept used in decentralized exchanges). This is just an illusion because token devs have additional tokens in wallets that can be used to drain this liquidity.

The myth of the audited contract.

Other investors absolutely look that a token smart contract is audited. Ok so a contract is audited. It cant create new tokens, it cant change the fees, it cant block the trading it is perfectly safe. Ok, but is that enough? What about the distribution of tokens , what if devs tokens are hidden in the presale process? And furthermore i dont think most investors bother to check if the audit result is not faked, i dont even know if they bother to read the audit result.

The myth of the team audit or kyc.

Some online services like pinksale as a way to make investor feel safer offer team audit services. That means that teams behind tokens are anonymous but if something goes wrong and they are complains by the investors this data is going to be released. That is supposed to discurage sams. Really? How do we know if the KYC process is correct? How do we know if scam tokens are not launched by those same online token services pages like pinksale ? There is a huge conflict of interests.

The fake transactions.

Some buyers think that a token is better if it has lots of transactions and unique addresses. How hard is to fake that? It is very easy by using automated bots.

 

Made up Articles in Medium , Reddit.

Paid services exists also for reddit, medium, again because coin buyers valuate those things. Here is an example of an offer for a reddit post plus upvotes. The token does not matther if its scam or not, what matters is to pay those pepole, 

Also many paid articles start with the name "Legit or Scam" this is because scammers pay articles on pages with strong page ranking to appear before real reviews. When you open a sponnsored review scam or legit..they will end up explaining you that the token is not a scam and you should invest asap.

 

Basically with this first part of the review i want to advise you that allmost everything is fake in 95% of the cases. And in 100% in the case of copy/pasted tokens/coins or directly generated from online services like pinksale. There is a 5% remaining that is actually not a scam. But how can you differentiate those projects from bad ones? My answer is that is extremly difficult.

 

PART 2: The token scam formula

 

Scams have always been there in all ambit's of our lives. The world of the Internet trading is not an exception. In forex trading you have fake brokers, fake automated bots, fake agents that try to let them manage your money etc.

In the world of crypto the situation is the same or worse. Some years ago, when bitcoin came out the first cryptocurrency coin/token scams appeared. They were forks(almost identical copies) of the bitcoin code, but with changed parameters, like the amount of coins in circulation, the block time. An example of that is DOGE COIN, which thanks to the endorsement of Elon Musk became very popular, but many years after its creation. But there was some important cost associated with forking(making a copy of a coin) like important technical knowledge, infrastructure cost to run nodes etc.

 

2022: Scams are much easier but very expensive

That is why i believe most trening tokens belong to the same people as the initial investment for a token in terms of promotions, web design etc is huge and maybe above 100.000 usd.

The new generation of token scams in 2021 and 2022 is a reult of the emergence of the so called smart contracts running on virtual machines and the appearance of the DEX(decentralized exchanges). Smart contracts run on many blockchains like Ethereum, Binance Smart Chain, Ada Cardano, Luna Terra, Solana etc. In 2020 Scams are much easier and I will try to explain why.

In general terms the token scam formula strategy is:

 

1) Copy / paste the code of a token, from some token that worked in the recent past or buy it for 100 usd from an online service like pinksale

 

First find what type of token is trending, just look at coinmarketcap. Most tokens to be more credible publish their code on sites like etherescan.io or bscscan.com. Everyone can copy the code and use it for its own token. They change some parameters like supply, token name, fees etc. An average solidity developer is needed  for that task to copy/paste and slightly modify your code. They are also online services that offer token creation services for under 100 usd, example pinksale.

 

2) Organize a presale of the token

This is a very important part. From here token scamers get their funds for marketing and initial liquidity on the decentralized exchanges. Still at this point they need important amounts of startup funds to advertise a token and create a fake community. Again pinksale offers presale services, but presale can be done from within the web page of the token creators. If this part is successful the scam has more way to grow. The funds are used as collateral in the decentralized exchanges like uniswap or pancake swap in order to create a market for the token. For some reason investor believe that if they get to buy a token at a presale level they can get a very high return later on. Exactly because of that there is a swarm of new tokens that act to scam people on the presale level.

 

2) Make a webpage that really looks good.

This is one of the most important part for a successful token scam. Professional designers are hired to make webs look incredibly nice, in order to deceive people. Use of memes is encouraged, almost mandatory, must get amazingly nices memes to succed.

 

3) Web page content: Invent some cool reasons why the token is very innovative although it is not.

Ok, the web design is important, but also the text content. A lot of imagination, lies and exaggerations are used to sell you a simple copy of a token as something extremely innovative. Some times tokens are called protocols because creators think that sells / sound better.

 

4) Promise some future developments (own NFT Marketplace, own exchange, own game, own blockchain)

This is a classical part of a scam. Sell a crypto token outlining its characteristics but also make a list of future developments that already started(lie of course) and would additionally revalue the price of the token.

 

5) WHITEPAPER

What Is a White Paper?

A white paper, also written as "whitepaper", is an informational document usually issued by a company or not-for-profit organization to promote or highlight the features of a solution, product, or service that it offers or plans to offer. White papers are also used as a method of presenting government policies and legislation and gauging public reaction.

In the world of scam tokens a whitepaper is used to convince you that a project is serious. But there is nothing serious about a copy/paste code. Usually you wil find just photos , promises and cliches, but nothing scientific.

 

6) List you token of different token pages and rate it with fake voting.

 

Pages like coinmooner and many other offer their customers possibility of voting. If a token gets enough votes it goes on a visible place so it can attract buyers attention. Paid services exist for that too. Scammers pay to the right people in order to get their token at a maximum visibility place.

 

PART 3 : The Token Scam Trend in 2022 by their type

 

They are two kind of scam tokens that are successfully selling on the market,

 

TYPE 1

High interest rates on tokens or high apy tokens - A more recent scam consists of offering insane interest rates on tokens(10000% , 200000% or more) paid in the same token). Those yields/returns are created programmatically out of nothing, their cost is 0. The goal of those tokens is to rise money mainly at presale level. For that reason they advertise strongly in the beginning of the process.

They use different rhetoric to sell you those copy/pasted tokens like:

 

TITANO SCAM https://titano.finance/ 102,483 APY $

Retohric Used:

The Best Auto-Staking & Auto-Compounding Protocol in Crypto

    Highest Fixed APY – 102,483%
    First Automatic Staking and Compounding in Your Wallet!
    Get Rewards Every 30 Minutes / 48 Times Daily!

LIBERO FINANCIAL SCAM https://libero.financial/ 158893 apy %

Rethoric Used:

The Highest Paying Dual Rewards Auto Staking Protocol

World's Highest Fixed APY - 158,893.59%

 

TheWeb3project SCAM https://www.theweb3project.com/ 404,192.85% APY

Retohric Used:

The only TRUE High Yield Protocol.
Low risk - backed by the WTFund + auto-buyback + Utilities
Interest paid every 3 seconds! Fastest Auto-Compounding possible
DUAL REBASING, steadily increase the amount and value of your $

404,192.85% APY

 

Hypershiba SCAM https://www.hypershibatoken.net/ 480000 % apy

Rhetoric Used:

The Most Profittable Shiba On Earth With The Highest APY in The Industry!!
480,000% APY and 4% Reflection in BUSD
Get Financially Free with Hyper Shiba Inu!!

 

Safuu SCAM https://safuu.com/ 383025 % apy

Rhetoric Used:

The Highest Paying Auto-Staking & Auto-Compounding Protocol

    Highest Fixed APY in Crypto – 383,025.80%
    Low Risk with Safuu Insurance Fund (SIF)
    Interest Paid Every 15 Minutes: 96 Times Daily!
    Automatic Staking and Compounding in Your Wallet!

 

ELON Dodge Inu SCAM https://elondogeinu.org/ 383000 % apy

Retohric Used:

The Highest Paying Auto-Staking & Auto-Compounding Protocol
Highest Fixed APY in Crypto – 383,025.80%.

Low Risk with EDInu Insurance Fund (EIF)
Interest Paid Every 15 Minutes: 96 Times Daily!
Automatic Staking and Compounding in Your Wallet!

 

AMBER Protocol SCAM https://amberprotocol.io/ 388000 % apy

Rhetoric Used:

THE LARGEST AUTO-STAKING &
AUTO-COMPOUNDING DEFI 3.0 PROTOCOL

    Highest Ever Fixed APY – 388,047.90%
    Auto Staking and Compounding in Your Wallet!
    Interest Paid Every 15 Minutes: 96 Times Daily!
    Massive Burning of supply every week.
    Very Low Risk with Amber Insurance Fund

 

Forever safu SCAM https://foreversafu.com/ 682000 % apy

Rhetoric Used:

The Highest Paying, Auto Staking & Auto Compounding Protocol

 

Crypto - 3R SCAM No web yet only telegram https://t.me/crypto3r 85,945% apy

Retohric Used:

3RCrypto Auto-Staking Protocol + 8% BUSD Reflection
HIGHEST APY +385945.8%

Re-Base" - Biggest Fixed APY – 385,945.80%
Reflections" - 8/9% BUSD Dividend every 1 Hour
"Re-buy" - Buyback periodically and strategically
Making Crypto Easy - Dont need to do anything just hold and watch your assets and money grow !

 

OCTRO FINANCE SCAM https://octro.finance/ 399,391.188% APY

Rhetoric Used:

Earn Passive income through Auto-Staking & Auto-Compounding

Apple DAO SCAM https://appledao.app/ 211465.20% APY

Rhetoric Used:

The Highest Paying Auto-Staking & Auto-Compounding Protocol in Crypto
Highest Fixed APY in Crypto – 211465.20%
Automatic Staking and Compounding in Your Wallet
Get Rewards Every 30 Minutes / 48 Times Daily
Elastic Supply with No Minting Function

 

MAXAPY SCAM https://maxapy.finance/ 960000% APY

Rhetoric Used:

The Best Auto-Staking & Auto-Compounding Protocol in Crypto

Highest Fixed APY – 960,000%
Interest Paid Every 3 Seconds
Automatic Staking and Compounding in Your Wallet!

WALLSTREET FINANCE SCAM (NO WEB, ON PRESALE ON PINKSALE) 960000% APY

BOX24 FINANCE SCAM (https://box24.finance/) 1,284,615.72% APY

Rhetoric Used:

First Asset Multiplication Protocol - Get reward in every 10 minutes!

  • Highest forever APY – 1,284,615.72%
  • First Automatic Staking and Compounding in Your Wallet!
  • Interest Paid Every 10 Minutes/24 Hour!

 

Others similar:

Metagold 2 SCAM https://metagoldrewards.com/ 1950 % apy

FLIBERO SCAM https://flibero.financial/

this one is a copy of libero currently running ads on google

 

TYPE 2

Redistribution tokens – Tokens with normal features(transfer, sell, buy, hold) but participants are taxed on every transaction (every person that buys or sells) with a tax ranging from 1% to 50%. Then  those percentages are redistributed according to different strategies decided by the token creators– some go to existing holders, marketing expenses, developers etc. Most of those tokens are copy paste or created directly from online platforms like pinksale.

For example a token has a tax of 10% if you buy and 10% if you sell. When you buy 1000 usd worth of tokens you actually get only 900. The remaining 100 are redistributed automatically as per the token code  according to different formulas and in different numbers.

In general those 10% or 100 usd go to :

Current holders: (5%), in our example 50 usd will get redistributed to all holders, investors seem to like that fact to passively recieve tokens, but this is scam. Because bigest part of those 50 usd would be recieved by the major holders, aka devs that created the token. And small investor will recieve almost nothing. Latest trends are that rewards are paid in stable coin. Well that does not change the scam structure.

Token Devs - 1% for example - they get 1% of every transaction

Be destroyed/burned - 1 % Investors think that deflacionary tokens are good thats why scamers add this feature. In reallity most projects are short term scams and being deflacionary does not mater.

Marketing 2% (or pay to influencers, contract adds etc, This is similar to going to devs as we dont know if they really go to marketing)

Buy back - 1% buying tokens on the market on behalf of ..devs.

As you can see no matter the strategy of redistribution the biggest part always goes to the devs. But this is not everything most tokens have major holes in their code that allow devs to trade without fees, change the overall buying/selling fees even mint new tokens.

Some examples of those tokens:

Y-5 finance - Previous Review on them

EverEarn - Previous Review on everearn

Babydrago

 

 

In this review I m using token/coin as if its the same, although technically it has different significance. Do your own duediligence, no investment advices. Becarful everything is scam.