$DOGE Many people do not recommend buying coins from domestic schemes in the cryptocurrency market for the following reasons:
High regulatory risk
- In China, activities related to virtual currency are considered illegal financial activities. Many coins from domestic schemes may involve illegal financial fraud, illegal fundraising, and other situations. These projects do not have legitimate operational qualifications and may be cracked down on by regulatory authorities at any time, resulting in investors losing all their money.
Concerns about project quality
- Technical risks: Some coins from domestic schemes have low technical content. They may not have genuinely innovative blockchain technology as support, merely mimicking some successful cryptocurrencies, and may have defects in key technical indicators such as security and scalability, leading to system failures or being hacked.
- Limited application scenarios: These coins often lack practical application scenarios. Unlike Bitcoin, which can be used for cross-border payments to some extent, or Ethereum, which is used for decentralized application development, many coins from domestic schemes may only be used for speculation and lack practical value support.
Severe market manipulation issues
- Risk of price manipulation: Some unscrupulous individuals control coins from domestic schemes, using information asymmetry and investors' greed to manipulate prices. They first buy large amounts in the market to create a false impression of price increase, attracting other investors to follow suit, and then sell at high prices, causing other investors to be trapped.
- False advertising: To promote price increases, project parties may exaggerate or even fabricate promotions. For example, claiming partnerships with certain well-known companies or significant technological breakthroughs, but in reality, these claims are baseless and merely aim to attract investors to buy.
Lack of trust foundation
- There have been multiple incidents of domestic scheme coins disappearing with investors' funds in the cryptocurrency market, leading to low trust in such projects. Additionally, some project teams lack transparency, making it difficult for investors to understand the true situation of the project and the qualifications and motivations of the teams behind it, increasing investment uncertainty and risk.
Here are some coins considered to be from domestic schemes:
- ACE coin: Developed by a top domestic technical team with independently developed high-performance public chain technology and rich application scenarios, but still faces many risks.
- EI coin: A domestic project issued on the Binance chain, with a crude website, exaggerated promotions, and a risk of disappearing.
- Can coin: A domestic-funded scheme disguised as a decentralized multi-chain wallet mining project developed by Korean and Japanese teams, with numerous fraudulent behaviors.
- TAC coin: Mainly promoted in domestic communities, where discussions about price drops are not allowed, raising suspicions of being a pump-and-dump scheme.
