Scam is such a strong word in today’s world. Why is this the case? It is because scams are rampant in every corner of the world and in every industry where finance is involved. Unfortunately, bad actors are actively working to trick people into stealing their funds, as the cryptocurrency community has witnessed in recent months.
Millions of dollars worth of cryptocurrencies have been stolen by digital hackers, mainly due to weaknesses in specific dApps or various bridging protocols. Scammers have scoured Twitter and other social apps like Telegram and Discord to steal people’s crypto, claiming it’s the latest and greatest project, only to end up stealing their ETH.
Are cryptocurrency trading bots similar or the same as a hack or a scam? It’s time to take a moment and dig a little deeper into this topic.
How to identify a scam
There is a fine line between a hoax and a legitimate project. How is this line? Scams are often portrayed as too good to be true, or too good to pass up.
If a project promises the moon, it’s time to step back and do more research. Offers of free tokens or large airdrops should be accepted with caution. Legitimate gifts do exist, but with reputable companies that have a proven track record.
Scams usually don’t show the faces or names of the people working on the “project”. If someone isn’t searchable on LinkedIn or Twitter, that’s a big red flag. Be careful when dealing with these so-called “companies” who do not reveal their true identities. If they were legitimate, they would have nothing to hide.
Scams can be easy to detect if the email received or the message read appears to be “spam” in nature. If there are misspellings, grammatical problems, or repetitive language, it is likely a scam and should be ignored.
Can a cryptocurrency trading bot be a scam?
A cryptocurrency trading bot “company” can be a scam, yes. Bots themselves do not have the ability to withdraw funds from a user’s account. Are there bad actors in the cryptocurrency trading bot space? As mentioned above, yes, which is why it is important to do due diligence when selecting a particular company to set up a trading robot.
Most bots on the market today are indeed legitimate, and most of them connect via API to a popular exchange.
How to identify a legitimate cryptocurrency trading robot
Potential crypto bot users are looking for a trusting relationship between them and the company they are going to sign up with. Various ways to detect the legitimacy of a bot can include the following:
Faces linked to social proof
The above resources will help determine the legitimacy of a cryptocurrency trading bot company. For example, looking at Stoic AI, potential investors can clearly see the features on the main site.