It is essential to do your own research before investing in a crypto project. To protect yourself, CertiK has developed a check-list of 5 red flags to watch out for.
Number 1. Marketing Traps. If a project uses multi-level marketing, influencers, fake news articles, or fear of missing out tactics, you should cross them off your list. Real startup projects will never plot any of these strategies.
Number 2. Unverified Dev Team. If a project team asks you to invest in them, but they find excuses to not be transparent, you have no reason to trust them. Honest teams will not shy away from appropriate due diligence processes.
Number 3. Absence of product. If you cannot understand what the product is, this likely means it is nonexistent or fake.
Number 4. Coding Issues. Legit developers routinely audit their smart contracts. You should always check the result of these audits on CertiK’s Security Leaderboard, and be wary if the project is not listed.
Number 5. Geographical Havens. Developers with fraudulent intentions that are located in countries with a less-developed regulatory system will use this to their advantage to steal your funds.
CertiK’s security audits and KYC verifications are publicly available so that you can confidently build your own personal crypto watch-list. Remember if you have the slightest doubt, consider it a red flag.
