Cryptocurrency vs. cryptotrash: Beware of scams!

While the unnamed Satoshi Nakamoto created Bitcoin to provide the world with a decentralized digital currency that does not depend on any state entity and that removes any type of middleman, i.e., that everyone is their own bank, the truth is that when it became widespread, all kinds of new projects began to emerge without a serious basis that promise great profits but that are nothing but scams.

Not all those behind these controversial proposals are scammers, since many really believe in the potential of their projects, but the truth is that people interested in investing should be attentive andstudy well each of them before depositing their money.

Cryptocurrency expert Iru Doramas joined "Cripto VOZ," the VOZ cryptocurrency podcast, to talk about how to identify these types of scams, which, he noted, are not few.

"I would say that 98% have no rhyme or reason," Doramas maintained. He stressed that he estimates that between 40% and 50% of the projects are launched with the intention of defrauding investors.

Although he highlighted that it is "very good" that the middleman has been removed, he warned that this also entails the responsibility of the potential investor to be properly informed. Those who fail to do so, he indicated, "are playing roulette to multiply their money."

Doramas argued that, in contrast to cryptocurrencies that have a serious backing, such as Bitcoin (BTC), Bitcoin Cash (BCH) and Ethereum (ETH), among others, most projects are established on an existing network where it is not necessary to program or create a blockchain.

In addition, decision-making is based on the amount of coins held by each person, which paves the way for arbitrary decisions on the part of those behind these projects which, although they may seem decentralized, are not. In fact, Doramas remarked, those who launch these types of proposals hold a large percentage of the tokens, so when people start to invest and the price starts to rise, they start to sell.

Doramas also advised potential investors to "study the technology behind Bitcoin very well," meaning Satoshi Nakamoto's "whitepaper," not Bitcoin (BTC) as it currently operates. He believes this cryptocurrency has moved away from the original idea of its creator, who argued that it should be used as person-to-person digital cash. This issue generated a division in the Bitcoin world that led to the emergence of Bitcoin Cash (BCH), following a split in the BTC network in 2017, to maintain Satoshi Nakamoto's original vision.

The specialist pointed out that the creation of Bitcoin involved a "revolutionary change." He explained that, in contrast to most of the projects that came later, it is a type of digital money that from day one did not have coins in circulation, and that since then, they have been released fairly to the people who have been contributing to the system. "When you understand that, you realize that it has not been possible to replicate," he said. This is why, he insisted, it is essential to understand this technology before investing.