Cryptocurrency holds the power to bring a person from rags to riches. The opposite is also true. Over the years, as the crypto industry became established, the number of frauds and malicious activities has also increased. There are almost 5000 cryptocurrencies all over the globe, but we trust only a few. Nowadays, cryptocurrencies are born from a trend, and consequently, investors pump their prices. However, the value of the assets decreases steeply with time, and the creator often abandons the project. The complexity in regulating cryptocurrencies often gives rise to ways for phishers to exploit them. Ponzi schemes, mining schemes, pump and dump schemes are rising as the crypto sector remains highly unchecked.
Fake cryptocurrency exchanges have become a real threat. Back in June, V Global, a South Korean cryptocurrency exchange, was accused of fraudulent activities. Almost 130 investors filed a class-action lawsuit against the crypto exchange. Approximately 69,000 people invested in the crypto exchange and suffered damages worth 3.8 trillion won ($3.5 billion). Like a typical Ponzi Scheme, the exchange operated through hierarchical levels of investors. They promised to reward them every time they brought a new member.
Back in September, the US Securities and Exchange Commission sued BitConnect and its founder, Satish Kumbhani. They had misused a total of $2 billion raised from investors worldwide. BitConnect was a typical Ponzi scheme wherein they assured the investors that they would share the profit made by the exchange.
Fake Cryptocurrency Apps on the rise
In September, Google Play removed eight cryptocurrency-related applications: BitFunds, Bitcoin Miner, Bitcoin (BTC), Crypto Holic, Daily Bitcoin Rewards, Bitcoin 2021, MineBit Pro, and Ethereum (ETH). All of them claimed to be either cloud-based miners or pool-based miners. However, they had no technical merits and had been accused of scamming money out of users for cloud mining services.
How to spot fake exchanges
Here are some other ways by which investors may be able to identify fake cryptocurrency exchanges:
High returns: Exchanges that offer unbelievably high returns in the first week of the investments.
Forcing to make larger investments: investors must not pay any attention to any external pressure to make larger investments.
Spam calls and messages: Frequent calls and messages may indicate that they are trying to collect funds.
Unreliable website: Several websites of these fake exchanges are maliciously infected. Investors must be careful enough because a click may direct them to attacks.
Unusually high withdrawal and registration fees: Some unregulated exchanges have abnormal fees. This may be a clear sign that the exchange might be a scam.
LCX Exchange: A safe trading avenue
Fake exchanges and apps have become extremely popular, and investors need to stick to reputed exchanges only.
The role of reputed exchanges becomes very important in such cases, which leads to an increase in the value of LCX. LCX is a compliant and secure blockchain-based company headquartered in Vaduz, Liechtenstein. The LCX Exchange is a reliable and secure cryptocurrency exchange offering a variety of assets.
Every day new altcoins which are cheaper are launched in the market. They have immensely high liquidity, which attracts investors. For a particular period, the market price of the token boosts, which is an outcome of the investor FOMO (fear of missing out). Generally, these projects rarely have any technical merits. Investors must put their money only on projects which are authentic and have real-world usage.
Offering a variety of digital assets, the LCX team makes sure that the tokens to be listed on their exchange are authentic and unwavering. With a user base of over 70,000, LCX has proven to be trustworthy among investors.
How LCX Helps Investors To Protect Their Crypto?
Regulated exchange with eight licenses: LCX has been granted eight out of the eleven crypto-related licenses in Liechtenstein, including TT Exchange Service Provider, TT Token Custodian, TT Price Service Provider, TT Identity Service Provider, Token Generator, Token Issuer on its own, Token Issuer for the clients and TT Key Custodian as it plans to expand its services. This makes it a full-proof and regulated cryptocurrency exchange.
Security of Users funds: To guarantee the security of the customer assets, most of their digital assets are stored in an offline, air-gapped Cold Storage system. While a small portion of digital assets is securely stored in hot wallets.
Multi-Wallet Interface: LCX also offers two types of wallets – a main wallet and an exchange wallet where users can hold their funds in the main account and transfer the funds required for trading to their exchange account.
Fully Audited: LCX is audited by Grant Thornton Liechtenstein, a top-notch audit and consulting firm. It is a member of the world’s leading networks of independent audit, tax, and advisory firms, Grant Thornton International Ltd. As LCX’s external auditing firm, Grant Thornton provides an array of assurance, tax, and advisory services. With the world’s best auditing services, LCX is set to position itself as a global retail exchange.
