If you have been reading my stuff, then you have a brief idea of what I am about. I have $0.00 to spend on investing into crypto. So, let me tell you about two scams that took ahold of my greed and hopes:
1. Rug Pull.
A crypto rug pull, is when someone creates a new coin/token and promises huge rewards and returns. They need you to put up money, so that they can then use that as liquidity and leverage against their coin, creating a value. The value is only perceived and not real. In the case of what I have done in the past, on Osmosis DEX, was to invest into a new coin using the utility token of the site: Osmo. Then when the new coin starts to drop in value, against the Osmo coin, the pool takes the Osmo to compensate for the trading out. Then you are left with hundreds of coins that are worthless and no Osmo.
If I was an unscrupulous character, I make a new ERC-20 token, list it on Osmosis DEX for $0.000001 each and offer a locked in 14 day pool staking reward of 1,000%. You see that, and buy in with $50 of Osmo and $50 of my new token. Once I see $100,000 or more locked into my pool, within the first day, I show that and reward my users with their reward, which is a $1,000. I pay out the money on the first day to the investors. Then on day 2, I pull out (which new coin listers CAN do on Osmosis DEX with no punishment or without stopping the pool, etc.). I would then be pulling out with that invested $100,000 minus the day 1 rewards. That is a huge profit to be made! Considering that your email, website and other information for the coin is disposable, you can make another and do the process again.
I was one of the shmucks who invested in a rug pull, not knowing it was a rug pull. I lost about $700 in crypto. I got $300 back on day 1 and then lost the rest on day 2, then I still had to watch my lose more, as the rest of the 12 day cycle wore down.
If I was to invest in these coin pairs again, I wouldn't.
2. Scams. There are no shortage of scams out there online and scamming people out of their crypto is no different. I remember one of the sites online promises to generate Bitcoin and then you select how much you want and then pay a transaction fee and then they send it to you. You want 5 BTC, well then send them a fee of 0.1 BTC and it is all yours! There is no 5 Bitcoin and your transaction fee will get deposited into their account, while their site will claim that it had not received your sent amount.
I fell victim to a site claiming that I could make money from the trading arbitrage between bitcoin and etherium. So on this site you trade 0.001 BTC for Eth. The amount you get from that trade you then trade back to BTC on a different trading site. All trading sites and exchanges have different trade fees and those fees are often included into the value of the trade. This means that it could be possible to make money, albeit fractions of a dollar at a time, by trading crypto from one website exchange to another. Well, this website offered that possibility and they got me when they asked me to deposit some BTC for trading and then said that I needed a minimum in order to cover the fees and the minimum withdraw amount. When I had a certain amount in, they claimed it never arrived as the blockchain had showed that they did receive it but still they claimed to not have. But what could I do? I complained, had their customer service reassure me that everything was legit, and then everything vanished and they had no record of my trades or deposits. I had a bad feeling when I first deposited my first amount for the trade, but then seeing the amount I had on there, thinking the best in the site and maybe it was just a glitch or an accident or it was slow I fell for it a second time and I was screwed by then.
If I was to do this again, I would send the minimum amount of $1 as a test. I don't ever want to pay a website in order to make a profit with crypto, unless I run a test and get it all back.
