Scams in GameFi projects

scams in gamefi

Scams in Gamefi increase as the subsector notes meteoric growth. The blockchain gaming industry is one of the most prominent players in the market and its prospects have never declined. With the advent of blockchain-based decentralized gaming,the gaming sector started its development towards a new phase. The recent tide of new games has created a new revolution in the global community. Blockchain gaming and the incorporation of NFTs have been earnestly fascinating new players to involve in the development process, besides enjoying their favorite gameplays.

Despite the volatility of the crypto market, GameFi has constantly stepped up and the price of its tokens is routinely increasing because of its NFT element. Investors nowadays are not attending to the need to improve the game mechanics. They are rather focused on earning profit out of reselling the in-game assets. So, analyze the marketing and technological peripheral of a project, along with the advantage its token. But this is the point where you might get tricked.

In the crowd of blockchain-based projects, there is a high probability of every random one being dishonest with its offerings. One needs to be wary about the alluring promises from any GameFi project.

Let’s have a look at how can we avoid such scams in gamefi and the simple strategy to identify them.

How to spot a scam?

It is observed that NFT games are generally wide-reaching but heavily planned on accomplishing their purpose to ransack the community. They target such investors who are not experts but novices, so they can tempt amateur investors with mesmerizing commercials. Hence, before putting the money into any project, one must be aware of the probabilities of such a trap and be wary in the following ways:

1. Their Team:

If someone is presenting his new project in the global market, he must be someone with stockpiled knowledge and experience. Their genuine and detailed information on Internet, along with their track record of career, gives an adequate amount of reliability factor. On the other hand, when a new project’s team stays anonymous, then that is a sign of something shady. It happens regardless of the scale on which it is launched and being promoted in the market.

2. Their social network:

A quick look and analysis of the social network is asking the community to invest in the prospects of incredible success in the future. It will give you a strong hunch on its credibility. You must look out for the bunch of people following them, along with the essence of their responses in the community. This elaborates whether the community is vulnerable to being mass-scammed, or experts are involved with expert project analysis. 

3. Smart contract:

With any of the easily-available online amenities, like Etherscan, BscScan, etc. you can go through the smart contracts incorporated in the project to get detailed data on the time when the project was formed, launched in the market, its users, and information on its tokens. You can check or get them checked in any community of experts, to make a calculated assessment of investing in that project.

4. Network marketing:

Multi-Level Marketing (MLM) is a popular system on which a good deal of GameFi projects are framed. MLM has constantly been successful in drawing the interest of new users in the projects it has been involved in. However, MLM is the project’s only source of revenue and still they are promising huge profits to its users. Without any concrete value-added channels and structures for investors’ profits, the project might be a big scam. 

Conclusion: Beware of the scams in gamefi

It is imperative to highlight that maximum projects often start with just a white paper, an attractive website, and a token listing on a crypto exchange. Fictional employees and fake partnerships are common traps to mislead new investors. One must also try to engage in the gameplay, because if the game is not real then it might seem as a rug-pull scheme.

Algobitz provides blockchain expertise, domain knowledge and GTM strategies to start-ups looking to launch a hybrid crypto exchange. Our experienced blockchain engineers and SMEs enable you to pivot faster and smarter. We help them to acheive their business goals and penetrate the market with an impact, without falling for such scam projects.

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