An exit scam is the deliberate act of escaping or disappearing with project funds.
There are several ways to mitigate loosing your money to exit scams. No one is safe and most blockchain investors have fallen victim to a scam one way or another.
How to Mitigate Exit Scams in The Blockchain Space
Research The Team and Members
The first method is, when faced with a new blockchain project, to research the team members behind it. Often times scammers leave a trail to past scams either trough transaction history or social media presence.
Trust your gut. If something sounds sketchy it probably is. Nature fine tuned your instincts with millions of years of natural evolution. Go ahead and use this in your favor.
Its a good strategy to hang around known developers and people with track history in the space. Related projects are also a good indication for long term success and viability.
Projects with non anon team members are also a good green flag.
Check for Unrealistic Promises
The blockchain world is filled with sellers of snake oil and deceptive marketing. Over the top gains are the bread and butter most investors have to deal with. Get acquainted with the basic arithmetic math principles to check the viability and fundamentals of the gains presented to you.
Keep Tabs on Project Funds
Often times, scammers have low tolerance and emotional intelligence to wait for project completion. They will start draining the funds for marketing or other dubious purposes.
Watch out for clouded reported numbers, spaced out communications and mismanagement of funds without accountability.
Diversify Your Investments
Never go full retard into a Dapp or project.Emnl – Dapp Investor
The key to properly mitigate loosing money to exit scams is to have an inhuman approach to it, to diversify your investment portfolio, across projects, Dapps and blockchains. Ideally before you go hard on blockchain you already have a sound investment portfolio outside of it with salary, P2P, Real Estate or MMO.
Discuss With Others
A book strategy carried out by scammers is to remove contrary opinions and comments. By keeping yourself in several communities throughout the Internet you can corner scammers and find holes in their pitch.
Keep yourself updated with the latest community news and changes with Telegram, Reddit, Facebook, YouTube and Discord communities.
Notable Exit Scams (to be updated with time)
GamblerKing – EnergyFund – exit with community funds
To Be King/Team Crazy