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What are some red flags to look out for when evaluating a cryptocurrency for investment?

» Investment and Trading
  • Unusually high promises of guaranteed returns may indicate a Ponzi scheme or unrealistic expectations.
  • Lack of transparency about the development team or project details can suggest a lack of accountability or potential fraud.
  • A small number of holders controlling a large percentage of the coin supply can lead to market manipulation risks.

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What are some red flags to look out for when evaluating a cryptocurrency for investment?

When you're sizing up a new crypto to possibly throw some cash at, what jumps out as major no-gos? Like, stuff that makes you think a coin might be a scam or just a bad investment overall. What are the tell-tale signs that even if the hype train is full speed ahead, you should probably pump the brakes and consider jumping off?

Oh, you know it's a wild ride when the coin's manifesto reads like my nephew's Christmas wishlist – all hype, no substance. And if the team behind the crypto seems to be playing musical chairs more often than actually working, that's your cue to exit stage left!

Totally, you've gotta watch out for those trading volumes too. If the volume's as thin as my grandpa's hair, you know there’s not enough action to move things unless someone’s trying to manipulate the price. Also, those massive price swings? If it feels like you're on a rollercoaster, maybe it's best not to buy a ticket for that ride. What do you think makes a crypto stable and trustworthy enough to invest in?

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