So is DeFi100 a scam that robbed investors of $23 million or a victim of a hacking scam perpetrated by malevolent parties that wanted to see the cryptocurrency fail?
The questions arising from a cryptic message on DeFi100’s website in May 2021 express the anxiety over cryptocurrencies, the fear of crypto scams and hacking, and partly signals why digital currencies are so volatile.
Although internet scams are not new, crypto scams are outstripping even forex trading scams in amount and scale. In some cases, it can be difficult to determine whether a cryptocurrency opportunity is legitimate or a crypto scam. If you have been affected by a crypto scam, it is important to file a complaint immediately and to seek guidance from Cryptocointrace.
Cryptocointrace experts can provide you with assistance if you have been affected by a scam. Our team of researchers knows what to look for when investigating frauds. We can provide you with information and guidance through our intelligence reports that will help you get results. Contact our Cryptocointrace professionals today for a consultation.
What Is DeFi100 and What Happened to its Website?
DeFi100 is a cryptocurrency built on the Binance chain. Its name stands for decentralized finance. It is one of the many thousands of cryptocurrencies on the market. As of late May 2021, there is still uncertainty over whether the DeFi100 is a scam or if its website has been hacked. Authorities are still investigating the matter.
The controversy started on May 23, when, according to Yahoo News, a message appeared on its website telling investors they had been scammed and there was “nothing you can do about it.” The message then disappeared. The people behind the DeFi100 cryptocurrency tweeted that their website was hacked. The value of the cryptocurrency declined 25% in just a few hours as a result.
One anonymous analyst on Twitter with 197,000 followers estimated the losses at $32 million. There are still some who do not believe the site was hacked and suspect the company is a scam that ran off with millions in investor funds. While the case is being examined, it is not certain which is the answer. However, the questions raised by this bizarre incident point out many issues with cryptocurrencies in the current environment.
What Does the DeFi100 Incident Say About Cryptocurrencies?
The incident with DeFi100, no matter the result, speaks volumes about the issue of cryptocurrencies and crypto scams. Whether DeFi100 turns out to be a scam or a legit cryptocurrency that was a victim of hacking, it is clear that the uncertainty over the issue points out why this asset class is so volatile and so vulnerable to fraud and cyber-attack.
The fact that it is uncertain whether the DeFi100 is legitimate or fake demonstrates the ambiguity of this type of investment. It is very easy for people to conceal their identities behind companies, introduce an ICO, and gain investors and coin holders.
One day, they can just run off with all of the money and disappear, since transactions on the blockchain are anonymous. The whole mechanism of cryptocurrencies seems to function through various black boxes and it is hard to know exactly who is doing what at any given time.
If DeFi100 is the victim of a malicious hack by competitors or cybercriminals, it demonstrates how vulnerable purely digital assets are. If hackers can gain access to a website and post a phony message, they can also get a hold of users’ and investors’ coins. It shows that even if the DeFi100 users and investors are not the targets of a crypto scam, they could have their data compromised by a site hack.
If DeFi100 is a crypto scam, it could claim that it can’t release funds because they were stolen or the hackers changed the information and locked everyone out of their accounts. It is impossible to know what happened, and without investigators, consumers must take the company’s word for it. There is no need to provide proof–they can just tweet out their version of the story and people will believe it until authorities get involved.
Are Cryptocurrencies Safe?
Between the inherent volatility of cryptocurrencies, crypto scams, and hacking, consumers may wonder if digital currencies are worth it. The answer is it all depends on how risk-averse the consumer is. Given all of these potential dangers, those who want to use or trade cryptocurrencies should start small and gradually build up their supply as they become familiar with them.
People tend to get hurt using or trading cryptocurrencies when they rush in too quickly not knowing very much about them. Crypto scams encourage a kind of haste and they do not offer transparency about what cryptocurrencies are and how the blockchain works. Going gradually, learning more about digital currencies, doing your due diligence, and researching people behind ICOs as well as regulated brokers are ways to stay safer with cryptocurrencies.
Signs of a Crypto Scam
You will reduce your risk of being a target of a crypto scam if you research the deal or the currency and start small. Here are some signs of a crypto scam that you should avoid:
- Deals are offered on social media rather than on an official ICO platform or through a regulated broker
- Lack of transparency
- Encourages haste
- It is not clear who is behind the deal or the coin
- There is no real website or white paper
- Gives extravagant promises of huge returns
- Will not release funds
- Does not communicate or disappears.
How to Protect Yourself Against Crypto Scams
To protect yourself against crypto scams, do your research. Work only with a regulated broker or a licensed exchange. Expect volatility. Even in the best scenario, cryptocurrencies fluctuate widely in value. You could lose or gain money quickly. Take gains and do not use the money you can’t afford to lose in cryptocurrency deals.
It may be tempting to take a chance in that deal that promises to be once-in-a-lifetime or that investment that is supposed to yield huge returns. However, cryptocurrencies have been around since 2008 and have had their ups and downs. They will be with us for much longer and there is always time to research a deal and choose one that will provide value. Reacting to anonymous claims, however, can put you in the path of a crypto scam.
Have You Been Affected by a Crypto Scam? Talk to Cryptocointrace Professionals!
If you have lost money from a crypto scam or forex trading scam talk to Cryptocointrace today. Our team has the expertise and knowledge as well as tools to perform in-depth research. We are skilled at investigating all types of financial services and have extensive experience in the financial industry. We will help you get results for your claim and resolve your complaint or dispute.