What are crypto signal groups? 5 reasons why you shouldn’t trust them

If you are looking for an easy way to start crypto trading, you might come across crypto signal groups. But what are crypto signal groups and how do they work? Most importantly, should you trust them with your own money?

What are crypto signal groups?

Crypto signal groups are online communities created by crypto traders who share information about the market, their trades, crypto and more. You can usually find crypto signal groups on popular social media platforms like Discord, Telegram, WhatsApp or Twitter.

The idea behind a crypto signal group is quite simple. As a member, you will be informed about the best time to buy and sell cryptocurrencies. Signal groups can also let you know about new and exciting projects so you can get on board as soon as the project starts.

But do all crypto groups deserve your trust?

5 reasons why crypto signal groups are untrustworthy

Ideally, all crypto groups give reliable and accurate signals that lead their members to spectacular profits. However, this may not always be the case as you should not trust crypto signal groups.

1. You will not learn anything about crypto trading

If you are looking for a crypto signals group to join, chances are you are a beginner in trading. It might not be the best solution if you are looking for a way to learn about crypto trading.

Most groups, especially those that are free to join, give little to no information about the trades. The admins simply post a message about which token you should buy and when you should do so. And most of the time there is not enough time to do proper research on the project itself.

Of course, some groups give detailed explanations of the following trades, but those are the exceptions. And these groups are usually not free.

2. The crypto “signals” are likely copied from another source

The truth is, you might not be the only beginner in this group. If the admin keeps posting trading signals without explanation, these signals could be copied from somewhere else.

Many traders post their trades online, so finding the next “signal” shouldn’t be too difficult for group admins. Well, they might do this to build authority if they aren’t knowledgeable enough. Then, if their “signals” stand the test of time, they could switch from a free trading group to a paid one.

3. It could be expensive

As we mentioned earlier, there are crypto signal groups that you can join for free, but don’t expect too much from them. Joining a paid group can be expensive as you can pay hundreds of dollars a month.

Even if you pay good money, it doesn’t make your trades risk-free, so you can break the bank, especially if you ruthlessly follow every trading signal.

4. It could be a rug-pull scheme

As the crypto market has grown exponentially over the past few years, so has the number of scammers. If someone creates a crypto token with the sole purpose of pulling the rug on their crypto investors, they need to market the token to attract investors.

So you could create one or more crypto signal groups to attract new buyers to your soon-to-be-worthless coin.

5. The group assumes no responsibility

The more members a group has, the more successful it is. Therefore, admins sometimes exaggerate the results to increase their audience. If you show the difference between their claims and reality, you may get banned quickly.

If the admins are the only ones who can post within the group, that’s a clear sign that they don’t want anyone to question their expertise and authority. Also, nothing stops the moderators from leaving or deleting the group once they make enough money.

What to do instead of joining a Crypto Signal Group

If a crypto signal group seems shady to you, you better trust your instincts. In this case, you should look for alternatives to understand how the market works and what are the best practices.

Luckily, you can gather useful information while avoiding not-so-trustworthy crypto signal groups.

1. Go to the social forums

There are many social forums dedicated to crypto and you can easily find them on Reddit, Twitter, Telegram, etc. In these forums you can learn about trading, market sentiment, new crypto projects, mining and everything crypto related.

As you might expect, many forums are filled with irrelevant information, hopeless crypto projects, or scammers. However, there are many crypto forums that share authentic information.

2. Learn on a reputable platform

When it comes to crypto, many personalities and websites preach their knowledge of crypto. As such, it can be difficult to choose one to learn from.

Perhaps the safest thing to do is learn from a well-known crypto platform like Binance or Coinbase. And the best part is that these platforms pay you to learn about crypto.

3. Copy experienced traders

Aside from learning about crypto, some platforms allow you to copy other people’s trades. This way you can check how experienced traders are managing their wealth and see the results.

This is a good way to start trading if you don’t have the time or experience. However, you should remember that someone else is making the decisions for you.

4. Start mock trades

Once you have your trading system put together, it is best to test it out before investing your money. Test your strategy with a risk-free crypto trading simulator so you don’t lose a penny if your plans don’t go as expected.

Once you are profitable and feel confident enough, you can start investing real money in your crypto trading.

Should You Trust Crypto Signal Groups?

When it comes to crypto signal groups, make sure it doesn’t sound too good to be true. If the admins are keeping their identities secret, it’s best to stay away.

However, you should keep learning because the more you know about cryptocurrencies, the more comfortable you will feel about trading. Fortunately, there are many tools to learn such as B. YouTube channels, forums or podcasts.

The information on this website does not constitute financial advice, investment advice or trading advice and should not be relied upon as such. MakeUseOf does not provide trading or investment advice and does not recommend buying or selling any particular cryptocurrency. Always conduct your own due diligence and consult a licensed financial advisor for investment advice.