Lessons from the $LIBRA Controversy: How to protect yourself from crypto frauds
If it sounds too good to be true, it probably is
One of the major red flags in crypto scams is the promise of guaranteed high returns with little to no risk. Remember how LIBRA was supposed to revolutionize payments globally with the backing of major companies? The hype train had no brakes, and regulators quickly intervened. Similarly, scams today use exaggerated promises, like 10x returns or “risk-free” investments. Always verify the business model—no legitimate investment guarantees profits.
Understand who behind the project is
LIBRA had some of the biggest names behind it, yet it still fell apart due to regulatory challenges. This tells us that even a strong backing doesn’t mean success in crypto. Now imagine a project with anonymous founders or shady pasts—would you trust it with your money? Always research the team, their track record, and their past projects. Transparency is key in crypto.
Watch out for regulatory red flags
One of the reasons LIBRA failed was that regulators across the world saw it as a threat. This brings up a crucial lesson: if a crypto project openly defies regulations or claims to be “immune” to legal frameworks, it’s a red flag. Scam projects often operate in legally grey areas to avoid accountability. Stay
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