Scam News

A Redditor spots a virtual currency website with scam-like characteristics

Investors seem to be carefully analyzing the details of a virtual currency website before they trust it with their investments. A new website, Doubly, was spotted by a Redditor as having the characteristics of a scam.

The virtual currency website promises profits higher than those promised by BitConnect and uses a trading bot. The website claims that the bot applies artificial intelligence to conduct extraordinary investment for those who are brave enough to invest.

Commenting on the post on Reddit, Singaporeroy, a Redditor, notes:

The article says it all… Showing an investment just shy of $12,000 will pay $657 per day, for 57 days until someone has paid $36,000 – that’s a $24,000 profit in less than 2 months… To be precise, this sounds like a ponzi scheme.

A ponzi scheme is characterized by a pyramid structure where one investor is encouraged to recruit another member and earn a commission in the process. A pyramid scheme only benefits its founders with the recruits left counting losses once the whole thing collapses.

Another characteristic of a pyramid scheme is investors being cleverly coerced to invest more money so that they can be able to withdraw whatever profits they have earned. While each investor’s purported profits are displayed on their account, the main purpose for the display is to lure them to invest more trying to get to the withdrawal stage.

For the scam-like virtual currency website discovered by the Redditor, none of the claims are “proof they have created a trading bot capable of 400% returns.”

As the cryptocurrency market shakes off the bearish phase to give room for the bulls to take over, such cryptocurrency websites will continue to increase in number in a bid to defraud cryptocurrency investors. As we enter this stage, invest on platforms that have enough supporting claims and documents plus a thorough background check is the first step before committing on any investment opportunity.

Apart from high payouts, what other characteristics should crypto investors look out for before trusting a virtual currency website with their investment?

Let us know your thoughts in the comments section below.

coinmag

Philip is an experienced blogger keen on staying updated with trends and news surrounding the blockchain and Bitcoin space. With several years of freelance experience in various industries, Philip brings his knowledge and experience into the crypto space.

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