6 reasons not to trust crypto influencers

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Influencers are popular personalities who have amassed a dedicated social network that usually pays attention to what they say on particular topics, such as cryptocurrencies. While cryptocurrency influencers can provide information and opinions that can be valuable to investors, blind reliance on their advice can harm your financial well-being.

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So why not trust crypto influencers?

1. They’re usually paid to say what you want to hear.

Crypto developers sponsor crypto influencers and give them hefty compensation for promoting their projects. They pay influencers to say what they want you to hear, whether it’s true or not. So whether they say they have invested a lot of money in a piece or a project does not guarantee that it will make a lot of money.

These influencers with little to no crypto knowledge are usually given a script of what to say about a cryptocurrency they want you to invest in.

Crypto influencers have been known to promote (crypto shilling) new speculative assets, often highlighting prospects for big returns and painting a rosy picture of the asset’s potential.

Although crypto influencers may come across as enthusiastic promoters of various cryptocurrencies, it is important to recognize that their endorsement does not necessarily reflect their personal investment choices.

As mentioned, they get paid to promote certain aspects rather than investing in them personally.

Some crypto influencers engage in crypto pump and dump schemes, where they use social media to promote interest in an altcoin, token or coin that has no real and immediate purpose for their followers.

By creating a buzz around the asset, its price is artificially inflated. Once the price has risen, they sell their holdings, causing the asset to collapse and leaving their followers with losses.

The misleading advice to buy these coins, which often ends up dropping, shows why information from crypto influencers is unreliable and should not be trusted.

4. They Are Usually Not Experts in Crypto or Finance

Crypto influencers may not have the knowledge or research skills to offer accurate information. Their content focuses on short-term market movements, quick trades, and immediate profit opportunities.

They spare no time in researching the risks associated with buying a particular coin at a particular time. Cryptocurrencies are very volatile and unpredictable; even crypto experts may not always get it right.

Crypto influencers are not allowed to give financial advice. Therefore, any crypto offering that promises one hundred percent guaranteed returns is definitely a red flag. They may have made money from crypto, but that doesn’t make them crypto experts.

5. Scammers Can Impersonate Crypto Influencers

The crypto space is unregulated, allowing anyone to pose as an influencer or crypto expert without formal qualifications. Social media platforms like YouTube and Twitter have several self-proclaimed crypto experts spreading crypto content.

These scammers go so far as to post sponsored posts with promises of guaranteed returns. They may claim inside information, secret strategies, or exclusive access to particular projects.

For example, they may offer you a free gift, a private group, a trading course, or a referral link. They can trick you into participating in airdrops, ICOs, or presales that require you to send funds to an unknown address or provide your private keys. These are all scams that aim to steal your money or your identity.

6. You can’t hold them accountable

Influencers cannot be held responsible when investment results take a negative turn. Their analyzes and predictions are mostly based on subjective opinions rather than basic research.

The fact that they are not authorized to give financial advice, which is often implied by disclaimers in their content, means that they are not legally held to account for losses suffered by their subscribers.

Relying on their advice is at your own risk.

6 places to get information or advice on crypto investments

We must emphasize that it is essential to explore several sources and conduct your own research when seeking information or advice on cryptocurrency investments.

We have highlighted some places where you can get crypto investing information and advice.

1. Reliable Crypto Exchanges

Crypto exchanges are platforms where you buy, sell, and trade cryptocurrencies or transact with other users.

Some centralized crypto exchanges like Binance provide educational resources to help you learn more about the crypto market, such as market data, charts, news, analysis, webinars, and more.

2. Credible crypto news sites and investment blogs Image Credit: DeFi Chain / DeFi Chain Blog

It is easier to make informed investment decisions by reading, listening to, or watching the latest news, analysis, and market trends in the cryptocurrency space.

News sites provide up-to-date reports on breaking news, while crypto-focused blogs and financial news platforms offer valuable information on investment strategies shared by experts and enthusiasts, as well as information on upcoming events, market updates, regulatory changes and new project launches.

3. Crypto Forums with Experienced Investors

Forums are a good source of information. And although there are many communities online where people discuss cryptocurrency, you should always visit the best crypto forums.

When you are part of a crypto forum, you can listen to and learn from seasoned and experienced crypto experts and other investors about market trends in the crypto space.

4. Crypto Podcasts

Listening to crypto podcasts is a great way to improve your crypto knowledge by learning about the fundamentals, strategies, tools, and best practices of crypto trading and investing. To help you learn more about it, we’ve listed some of the best crypto podcasts you should tune into.

Additionally, you can watch and listen to interviews and discussions with experts and knowledgeable people who look into several crypto projects and investment opportunities.

5. Official Project Websites and White Papers

When researching a particular cryptocurrency, you should visit a project’s official website for essential information about the project’s goals, team members, technology, partnerships, and others. relevant details.

Reading their white papers will give you an in-depth knowledge of the project’s goals and potential. Additionally, you can determine whether the project fits your investment objectives, risk tolerance and overall strategy.

6. Social Trading Platforms

Social trading platforms are online platforms that allow you to interact with other investors like you, share their trading strategies, track their performance, and copy their trades.

You can follow and learn from experienced traders with proven track records in the crypto market. You can see their portfolio, trading history, risk profile and trading style. You can also ask them questions and get feedback on your trades. However, you should not use just any social trading platform. Instead, use one of the best crypto social trading platforms that offers protection, automation, and other features.

Never blindly trust crypto influencers

Although crypto influencers offer valuable information, you should remember that not all crypto influencers are investors. You should never mindlessly trust an influencer, but exercise caution and verify information.

Don’t buy into the hype for fear of missing out. Instead, do your research, follow real crypto experts, and understand the crypto terrain before investing in it.

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