Since 2017, a lot of traders have appeared in Pavel Durov's messenger, who share their advice and recommendations with subscribers. Sometimes it's just a trap for inexperienced users
The volatility of the Bitcoin exchange rate and other coins attracted not only investors, but also scammers to the cryptocurrency market. There are many channels on Telegram where traders share trading ideas. Some can carry income. Others – to be deliberate manipulation aimed at deceiving subscribers and stealing their money.
For example, a user who logs on to the channel sees a series of deals and tips that have worked without loss or with a profit. Because of this, he may have unreasonable trust in the owners of the group.
To achieve this effect, the administrators of some channels give several signals to buy or sell coins. Successfully fulfilled recommendations are duplicated with the comment, conditionally, “profit is fixed!”. Tips with a negative result can be removed from history.
Another way to attract customers is to send a message about a successful deal offered in a closed paid group to the main channel. In this case, the only way for users to find out about the unsuccessful recommendations of traders is to buy a subscription and see for themselves. Using these methods, certain channels form imaginary positive statistics, earning the trust of the audience. Subsequently, her loyalty and desire to make quick money can become a tool for manipulation and deception.
VIP groups and trust management
Subscriber loyalty can be leveraged in a variety of ways. For example, to sell a paid subscription to a VIP channel. Unscrupulous traders create the illusion of big earnings in order to lure new users into private groups. They give signals to buy and sell various assets and other financial recommendations.
How high quality they are is a separate question. But if for the owner of the group it is more important to make money on the sale of subscriptions, and not on trading, then the signals will most likely not work. Another scheme is that they can simply be copied from random free channels.
Another way to make money on your audience is trust management. It works as follows: the channel administrator takes control of a certain amount in the cryptocurrency, on the condition that he will trade it, and keep a fixed percentage of the profit for himself.
An unscrupulous trader divides the received coins into two halves. Each of them is used to open both long and short positions at the same time. Therefore, no matter what happens to the rate of the asset, one of the transactions will be profitable. The attacker will receive his percentage, but someone will be left without their money.
But for the owner of the channel, who was originally going to deceive the subscribers, this does not matter. As a rule, attackers refuse to be held responsible for failures even at the stage of concluding a deal.
Trust management can also be used to steal cryptocurrency. A similar thing happened in late December with Twitter user stealthbomber10. In his account, he said that, together with a group of people, he gave the cryptocurrency to a trader under the nickname LEON, who later disappeared.
The attacker collected capital from subscribers, which was used for trading. The profit from it, by agreement, was to be divided between the parties to the transaction. However, this did not happen. LEON, instead of the promised increase of 200% to the deposit of investors, disappeared with their cryptocurrency, deleting accounts on social networks, stealthbomber10 wrote.
The transfer of cryptocurrency into trust is often formalized in words. Gullible but inexperienced investors give away coins, guided by the reputation of the trader, his promises of large profits, on the recommendation of friends and other reasons.
In this case, if the trustee loses capital or turns out to be a fraud and steals money, it will not work to ask him. Therefore, capital should be donated to management by well-known people and only with the execution of an appropriate agreement.
Pumps and arbitration
In addition to providing paid services, such as access to VIP groups and trust management, some channels can arrange "pumps". Subscribers are invited to buy a certain coin, the name of which is revealed at the last moment, seconds before the start of the promotion.
As soon as this happens, the participants in the "pump" purchase an altcoin en masse in the hope of an instant increase in its rate. The asset may rise in price, but it is mainly the organizers who make money on this, while the subscribers are left with a cryptocurrency with a dubious future.
In other words, channel administrators who want to make money on their subscribers buy an illiquid coin, artificially inflate its rate, and after a while organize a "pump" to get rid of it. If the price of a cryptocurrency skyrockets seriously, attackers reap a double benefit from this: they both earned on the audience and received a plus in statistics.
Another, but similar, way to manipulate subscribers is through arbitration. The channel gives a signal to buy an asset on one exchange, hoping to resell it profitably on another. Data from aggregators such as Coinmarketcap can be used as confirmation.
Such services, like exchanges, show the price of assets for the last deal, and not for open orders to buy or sell. The attacker uses this in the following way:
- Buys an illiquid altcoin and transfers it to exchange A, where its price is higher than the market average, for example, by 10%;
- On site B, it artificially inflates the asset rate, for example, by 50%. To do this, you need to find an exchange with a small number of open orders to sell altcoin and buy it at a high price, which will be fixed by the aggregator.
- He reports in his channel about the difference in the cost of cryptocurrency on sites A and B, and, accordingly, the opportunity to make money on it.
As a result, subscribers buy the coin at an overpriced price from the channel administrator on exchange A. When they transfer the asset to platform B, it turns out that it can only be sold at the market rate, at a loss.
Red flags
Not all crypto channels on Telegram aim to deceive and steal from subscribers. But in order not to fall into the hook of an attacker and not to give money into the wrong hands, you should resort to careful analysis. For example:
- you should be suspicious of groups that promise guaranteed multiple profits;
- make sure that the channel owners are actually trading and have income from it. Often, dishonest traders only report transactions, and as evidence they attach someone else's screenshots or screenshots tweaked in Photoshop;
- monitor whether unprofitable recommendations disappear from the channel history. For example, if there was a signal to buy Bitcoin at $ 10,000, and after a while it dropped significantly in price, then a conscientious administrator will write about an unsuccessful transaction. Otherwise, the recommendation will be ignored or deleted;
- Learn about the channel's reputation. If once his subscribers were deceived for money, it may be possible to find information about this in other groups or on the Internet.
If an investor decides to give his cryptocurrency in trust, it is imperative that:
- find out reliable information about the identity of channel administrators – names, addresses, it will not be superfluous to request a personal meeting;
- look for complaints about these traders on the Internet or other channels. As practice shows, even the smallest criminal schemes emerge in the crypto community;
- conclude an agreement with the prescribed conditions and risks, make sure with trusted lawyers that it is genuine and that there are no “pitfalls”.