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[1. LACK OF NAMED TEAM LEADS OR DEVELOPERS]

Cryptocurrencies have been receiving a lot of attention in the investing community due to the astonishing gains made by Bitcoin, Litecoin, and Ethereum in recent years. However, even though many people have made substantial amounts of money investing in cryptocurrencies, many others have also lost a lot of money.
This is because many people choose to invest in new ICO’s, which can be a lot riskier. There’s no question that every investment holds some risk, that’s why they have potential to earn you money. However, due to their nature, ICOs can be particularly volatile — and because of this volatility, have the potential to be extremely profitable.

That’s why you need to perform due diligence before you invest a dime into an ICO.
Luckily for investors, there are a number of signs that can indicate an ICO might be untrustworthy, and that it might be a scam. Below we have compiled seven of the most common signs associated with previous ICO scams.

1. LACK OF NAMED TEAM LEADS OR DEVELOPERS
Most strong and legitimate ICO projects will include the names of the team leads and developers who have worked on the project. The purpose of doing this is to help create a sense of trust and ownership. It helps to create accountability. Generally, when people set out to create an ICO scam, they do not want to get caught or be held accountable. So, if an ICO does not have named team leads or developers associated with the project, then you should be very suspicious.

2. VERY WEAK WHITEPAPER OR WEBSITE
Usually, when a legitimate ICO is being launched, the company behind it will take the time to create very strong websites and whitepapers that explain, in full detail, the value of the project and all of the reasons why people should invest in it.

If an ICO is a scam, there will, of course, be no good reason why people should invest in it. This means that the people behind it will often skip the step of creating a strong website or whitepaper to support the ICO.

3. LACK OF A CLEARLY LAID OUT ROADMAP
For most companies who create ICO’s, the ICO is just the first step on a series of other steps that are designed to propel the company forward into the future. So, if there is no clear roadmap associated with the ICO, then it is a major warning sign. A lack of a plan for the future is a very good indicator that the people behind the ICO are probably not planning on it being around for very long, because they are planning to pump and dump it.

4. A HEIGHTENED EXPRESSION OF URGENCY
If an ICO suddenly starts putting out a lot of hype about time limits and a need for urgency, then it is definitely something to watch out for. Many ICO scams rely on the so-called “FOMO,” or fear of missing out. So, the people behind these scams attempt to generate a large amount of FOMO in a very short amount of time with aggressive urgency campaigns. Then, once the ICO launches, they simply wait for FOMO to push the price up, and then sell. So, watch out for urgency campaigns and ICO’s who are trying to capitalize on FOMO.

5. UNCAPPED FUNDRAISING GOALS
ICO’s are generally created as an effort to generate a certain amount of capital that can be used to help a company fund a specific project or projects with growth as the end goal. Most legitimate ICO’s will state the amount of funding that the company aims to get with the ICO. For example, a company may be seeking $10 million from the ICO, $20 million, $30 million.

If the company or organization behind the ICO has not stated a specific amount of money that it is seeking to gain, then it could be an indication that the goal of the ICO is not actually to fund the company’s growth, but rather to scam investors. So, this is also something that you should watch out for while you are looking for ICO’s to invest in.

6. FAKE EMAILS
This is one of the simplest ICO scams, yet it can still create many victims. With a fake email phishing scam, the goal of the scammer is not to create a pump and dump scheme, but is instead to get the email recipient to click on a click which allows the email sender to steal personal information from the email recipient, either through a key logger, or by other means.

A key logger is a program that allows a hacker to see which keys are typed in on a keyboard, which can reveal back account passwords, cryptocurrency exchange passwords, etc. So, sometimes scammers will set up a fake ICO and use it as a phishing scheme to try to get people to click on links in the email.

7. PYRAMID STRUCTURES
If the ICO has a structure that resembles a typical pyramid scam in any way, then this could be an indication that it is a Ponzi scheme or pyramid scheme. Such a structure would typically involve multiple tiers where people are encouraged to bring in new buyers and are rewarded for doing so, and in this way, money flows up the pyramid.

Such schemes usually collapse when an insufficient number of new buyers are brought in and everyone stops getting paid. So, if you see any ICO’s with this structure, then you should be very cautious if you are thinking about investing.





I recommend the following;
1) Verify the authenticity of the social profiles of the members of the ICO team (linkedIn)
2) Check out the project progress published (GitHub)
3) Avoid businesses that work with referrals.
4) Avoiding unrealistic promises (profits with exorbitant figures)

As a last resort, make sure you use some good old-fashioned common sense. If something feels wrong or sounds too good to be true, then this could be another indication that there might be a scam going on. After you have done all of these things, if you plan to move forward with your investment then you should really be careful about how much money you put in.