Beware of Cryptocurrency Frauds

Beware of Cryptocurrency Frauds

Beware of Cryptocurrency Frauds

Does it seem like a new cryptocurrency is born each day?

Digital coins are popping up continuously, with each hoping to be the next Bitcoin. While most cryptocurrencies will likely never reach the value of Bitcoin, some of them have no intention to. That’s because scammers are becoming more prevalent all the time in the cryptocurrency market.
If you haven’t been paying attention, several agencies are starting to sound alarms. According to recent reports, The U.S. Commodity Futures Trading Commission (CFTC) has joined other regulators to warn traders about “pump-and-dump” cryptocurrency investing schemes.
The CFTC recently stated that, “Customers should not purchase virtual currencies, digital coins, or tokens based on social media tips or sudden price spikes.” The agency strongly encourages investors to, “Thoroughly research virtual currencies, digital coins, tokens, and the companies or entities behind them in order to separate hype.”
This is a very similar warning that regulators give to those who invest in penny stocks. These companies build up a lot of hype and advertise their cheap stocks, which helps inflate the price. Then it all comes crashing down as the fraudsters dump the stock at the last minute after they reach a specific price. Investors are left with nothing.
This is the same game that many scammers are utilizing with cryptocurrency. Therefore, let the buyer beware. Make sure you know that the digital currency you’re considering, is legit, as well as your transaction. Otherwise, you could get burned.

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Alan Olsen, CPA

Alan Olsen, is the Host of the American Dreams Show and the Managing Partner of GROCO.com.  GROCO is a premier family office and tax advisory firm located in the San Francisco Bay area serving clients all over the world.

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The American Dreams show was the brainchild of Alan Olsen, CPA, MBA. It was originally created to fill a specific need; often inexperienced entrepreneurs lacked basic information about raising capital and how to successfully start a business.

Alan sincerely wanted to respond to the many requests from aspiring entrepreneurs asking for the information and introductions they needed. But he had to find a way to help in which his venture capital clients and friends would not mind.

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