As Bitcoin's price skyrockets to $93,265.64 following recent political developments, novice investors are flooding the crypto market. However, this surge has also attracted sophisticated scams. Taiwan Shilin District Prosecutors' Office Chief Prosecutor Luo Weiyuan shares crucial advice for navigating this high-risk landscape.
3 Essential Reminders for Crypto Beginners
With extensive experience investigating financial crimes and TRM Labs certification in cryptocurrency forensics, Prosecutor Luo offers these vital warnings:
1. Do Your Own Research (DYOR)
"Market traps abound for unprepared investors," Luo emphasizes. He advises:
- Cross-verify information across reputable sources
- Understand project whitepapers thoroughly
- Never invest based solely on others' recommendations
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2. Choose Regulated Domestic Exchanges
Luo recommends:
- Verify platforms against Taiwan FSC's AML-compliant VASP list
- Remember that compliance doesn't eliminate all risks
3. Exercise Extreme Caution With Offshore Exchanges
Key considerations:
- Research jurisdictional oversight thoroughly
- Be skeptical of KOL endorsements
- Higher returns often indicate higher risks
Crypto Scam Encyclopedia: 6 Common Schemes
1. Unrealistic ROI Promises
- Red Flag: "Guaranteed" high annual returns
- Case Study: FTX and JPEX collapses
- Defense: If it sounds too good to be true, it is
2. Bitcoin ATM Scams
- Method: Pressure to convert cash via ATM transfers
- Protection: Never follow strangers' instructions
3. Investment Fraud
- Scheme: Fake wallet addresses
- Prevention: Control your private keys
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4. Mule Account Schemes
- Danger: Unknowingly facilitating money laundering
- Rule: Never share account access
5. "Air Coin" Scams
- Characteristics: No real utility or product
- Historical Examples: IBCoin, Magic Ticket Coin
6. Meme Coin Volatility
- Reality: 90%+ failure rate
- Advice: Only gamble what you can afford to lose
Emergency Protocol: 4 Steps After Discovering Fraud
Immediate Action
- Call 165 Anti-Fraud Hotline
- Provide transaction hashes
Stop All Transfers
- Freeze connected accounts
- Alert your exchange
Evidence Preservation
- Screenshot all communications
- Export blockchain records
Avoid Recovery Scams
- No legitimate company cold-calls victims
- Law enforcement doesn't charge for investigations
Three-Layered Anti-Scam Defense System
| Defense Layer | Key Components |
|---|---|
| Investor Education | Workshops, scam alerts, media literacy |
| Regulatory Framework | VASP registration, AML policies |
| Institutional Safeguards | Exchange KYC, bank transaction monitoring |
FAQ
Q: How can I verify a crypto project's legitimacy?
A: Check for:
- Doxxed team members
- Audited smart contracts
- Real-world use cases
Q: Are hardware wallets necessary?
A: Essential for holdings >$1,000. Trezor/Ledger provide enterprise-grade security.
Q: What's the safest way to enter crypto?
A: Dollar-cost averaging through regulated exchanges minimizes volatility risks.
Q: How do scammers target victims?
A: Primarily through:
- Phishing emails
- Fake support calls
- Social media pump groups
By maintaining vigilance and applying these protective measures, investors can safely participate in cryptocurrency's financial revolution while avoiding predatory schemes.