Because you can never be sure if the company you are working with, investing in, or partnering with is 100% legit (which is ironic considering the web3 community is all about open communication, and transparency.)
But that’s the problem – hype-marketing generates buzz and provides no value for those who fall for it, creating a vicious cycle where too many startups take advantage of the everyday user’s lack of understanding of the space.
A lot of people will happily jump on the bandwagon of the newest ‘Hairy Hamsters’ NFT collection when they see that the brand behind the project has 32K Discord, 10K Twitter and 3K Reddit followers – lending credibility to a project that has little to offer except levelling up your Discord rank on their server. Equally, investors will dump money they don’t have behind the newest trending token or emerging DAO (Decentralized Autonomous Organization) because they are made to believe 7,000,000% APY is realistic.
Stop falling for the bait, and DYOR (Do Your Own Research.)
Collectively, we should work hard to eradicate this hype-generating, “guerrilla” marketing loving brands that pray on an audience that has little education in the web3 space.
This is why, as a marketer/investor/founder or user of the space, you should pay close attention to those who you choose to share your bed with. Before approaching your next project, dox it (aka search for the information of the team or company behind the project and look for any malicious behaviour or trends.)
Maybe, the company behind your favourite token is just a giant Ponzi scheme. Maybe the NFT collection you thought was massive is just a small team copy-pasting hype-generating Twitter messages, employing paid bots to drive up engagement, and peddling art that will be worthless in the future (not ALL projects of course, but most will; let’s be honest here.)
So, what should you look out for?
Determining a genuine project from a fraudulent project is difficult, but there are a couple of checks you can make:
Research the team/company behind the project
- Cross-reference their identities with other social media platforms.
- Look for blue checkmarks.
- Look at their previous experience and network.
- If you can’t find anything about the team, or they are anonymous, RUN!
Find the projects/teams’ wallet addresses, and plug them into etherscan.io
- Check for suspicious transactions.
- Look at previous transaction history.
Check to find their token on coinmarketcap
- What’s the total market cap?
- What’s the trading volume?
- Check the token graph and identify implicit motivation.
- Read the comments towards the bottom right to see what others are saying about the token/project.
Check out their communities via Reddit/Twitter/Discord
- Is their community active and looks authentic? (i.e not spambots)
- Is their team responsive to questions and maintains regular, open dialogue?
- Is their roadmap clearly stated and followed?
Doing the above steps, for every new project/token/NFT/client that you find within the Web3 space will, not guarantee your safety, but at least give you the foundational questions that you can bring back and ask the team – provided they will answer your questions.
If they avoid any further prodding from your end or provide vague answers, our best advice is to run away, or if you like to take risks, proceed with caution.
If you’re curious to learn more about the Web3 space, connect with others, find work or just want to hang out and chill out, join our Discord community (spam-free and scam-free.)
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