In our latest in-depth video, Cointelegraph shares six key tips on how to increase your security when investing in DeFi by identifying Carpet Pulls – One of the Most Common Types of Crypto Scams Best.
Explosive growth coupled with a lack of oversight from traditional authorities has lured large numbers of scammers into the DeFi ecosystem. According to a recent report by Ciphertrace, fraudulent activity in cryptocurrencies has decreased overall, while scams in DeFi increased in 2021.
In a typical tapestry, the bad guys create a worthless token and list it on a decentralized exchange where it begins trading in a liquidity pool. The scammer convinces investors to provide liquidity by putting a mark like Eth, which drives up the price of the new token. At a certain point, the scammers “pull the carpet”: They take all of the Ethereum out of the pool and leave investors behind worthless tokens.
With the help of two DeFi experts, we shared 6 practical tips to help identify carpet-pulling issues and reduce the risk of fraud when investing in DeFi.
Check out our six tips in our video and don’t forget to subscribe to our YouTube channel!
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