Scams and Rugs are so damn common in Crypto since long.
Even after due diligence and research we get rugged. We start doing more research and the scammers keep getting better.
Let's discuss some points that we generally fall for even after researching and verifying. (This is not for all coins/tokens but a hell of a lot of them for sure). Today I'm writing about the ones who scam.
1)Full transparency.
2)Liquidity Locked for one year.
Before investing we verify these claims and these are true most of the times. Now we can trust them and invest in their project.
But wait...What does full transparency mean? (if they want to Rug pull)
Funny part is the scammers use this to gain your confidence. They will keep posting in the TG about what they are doing and how they are going about it...every single step. They will send screenshots of some payments for trending on some site and how the site is not responding since the coin is new.
They will also send screenshots of their conversations with different sites for marketing but are not being taken seriously. They will tell you about how they are working day and Night to get the utilities done on time, how they are working to get CMC and CG listing fast tracked etc. Most importantly they will tell you how many difficulties they are facing but they will not give up.
Now the investors feel it can't get more transparent than this. They trust the team completely and start shilling the coin themselves. If someone asks any questions about why something is not happening or proof of some commitment/promise in the roadmap, a team member, posing as an investor immediately pins the person down. The unsuspecting community joins in to ostracize that person and wants him banned.
The team thanks you for standing up for them. You feel you are the protector of the most honest team...LOL. The team keeps making promises and keeps telling you about every hurdle they come across and how much they are fighting/struggling to overcome those difficulties/hurdles. They make you believe they could have hidden the hurdle information but they want to be completely transparent.
90% chances are that one of the team members (mostly the one you've communicated the most with and trust the most) has some serious family issues or some really dear one expired and the team member is going thru a lot of stress. He loves the project and will be back soon. Now you feel for him and send him good wishes....They have just bought themselves more time...how much time? Well that depends on how soon you catch on to their lies...But in this process most of the community swears they have never met anyone more transparent.
Liquidity Locked for One year: We Check/ verify and are satisfied the Liquidity is locked for one year and we won't be rugged. Even if 100% liquidity is locked for one year, doesn't it get unlocked after a year? Now, the important thing to note here is mostly these will be Coins/Tokens that have a Tax on them. (12/14% on average and say about 4/8% goes to Liquidity.) This Tax is on every buy/sell or wallet transfer. With the Full Transparency assurance they have bought themselves a lot of time. By now a lot of people have bought, some have sold to book profits etc. Which means Liquidity is growing. And the rest of the tax is going directly in their pockets.
After a period of time, the Team starts selling their tokens from their other wallets. But everyone feels they are investors who are looking for small profits or who don't have long term vision and start calling them "jeets". The team assures you they will not give up and now is the time to buy the juicy dip. "These prices will never come back". Some team members themselves buy some small amounts from their different wallets. The unsuspecting believers start eating the dip. They want to become whales. This cycle continues for a bit until the price has really fallen a lot.
After some time the team stops communicating keeping an admin or Mod active in the TG. Most investors are, by now, in for a huge loss if they sell. They are not ready to eat the humble pie and sell (may be at a 90% loss) and get out. They keep their hopes alive. It is important to note that it is the "investors" who are keeping the TG alive now.
Soon, the coin is dead, people have moved on. Some frustration is shown in the telegram group. Some frustrated guys even threaten about suing them and are investigating to find out the team member's identities. But that also fizzles out. By now the Liquidity is unlocked. The scammers now own the Liquidity bag. Obviously the liquidity is removed. No one will notice or you can say "None the wiser". And mind you, this is not the only project these guys are probably working on. They start one, get it going, get the community to trust them, set up mods and admins (the community takes it on themselves to keep the TG and coin alive with comments like "Buy the Dip', "This is a great discount", "paper hands will cry" "the Dev's are working hard" "Trust the process" etc.) Then the team moves on to the next one...and so on and on and on. While you move on too...looking for the next gem.
This is my personal opinion/view and not financial advice and certainly does not apply to all coins/Tokens. So Please Do Your own Research. "Be very careful/cautious" is all I'm trying to say.
Good wishes to everyone.
