For newbie traders, there are many sharks lurking in the water to try and steal your hard earned coin. While many people are prepared for the phishing and wallet scams, not everyone is prepared for the more savvy “advice” based scams.

Some of these Telegram groups offer this information for free, but even more of them will expect you to pay for it. Unfortunately, buyer beware doesn’t even begin to cover this, and if you’re thinking about purchasing cryptocurrency trading advice from sharks you need to think twice about it.

So, in this article, we’ll be talking about crypto trading signals, and why they are pretty much always a bad idea. Just remember, if it sounds too good to be true, then it probably is, and in pretty much every case you’ll be left holding the bag here.

They come with no guarantees

Most people aren’t in the market of giving out their crypto trading signals for free. They will typically demand a handsome fee for their “expertise”. However, it’s extremely difficult to tell whether what you’re buying will be worth anything.

In 9 cases out of 10, you’re likely to just end up with a useless bag of magic beans that someone on Telegram promises will grow into a money tree. Unfortunately, they’re just beans, and you wasted a whole lot of money on them for nothing.

You’re probably buying into a pump and dump

Many of these Telegram signal groups, especially those offering free information, are actually pump and dump groups in disguise. Sadly, most people don’t do things out of the goodness of their hearts. If they really knew which cryptocurrencies were going to blow up they likely would not share that information with you, especially not for free.

Telegram or Twitter groups offering these signals have likely already bought their coins. Now, they’re looking for unsuspecting newbies who they can leave holding the bag when they sell. You’ll be buying in after the price pump, and that’s when they will exit.

These groups are counting on newbie traders that will just follow their advice blindly. Do yourself a favor and don’t be one of those people caught in their traps.

You got in on the signal too late

If the volume has already started exploding it’s too late for you to make a profit. Anyone who has given you this signal has done so with the intention of dumping useless coins or tokens on you so that they can make a profit for themselves.

While they may tell you that a coin that’s already sitting at 100% gain is going to pump up to 400%, the reality is that the pump has already happened and you missed it. Be very careful buying any coins which have already experienced a large amount of volume recently.

You’re getting old information

Some of these Telegram groups may simply copy and paste signals from other groups but they aren’t actually traders themselves. They’re just repackaging and selling information to get your hard earned coins.

They didn’t check any of the information themselves, and they could honestly care less if it’s correct. They’ve already got what they want from you so nothing else really matters to them.

You could end up holding a useless coin or token

Many of these “signal groups” that are really pump and dumps in disguise go after small market cap coins. In many cases, these coins have little to no trading volume. That’s how these people are so easily able to manipulate them.

Unfortunately, that’s bad news for you. It pretty much guarantees that when the group dumps their bags that the price will never be able to recover to anywhere near where it was when you bought in.

You’ll be stuck holding a coin or token that’s on life support with no way to recover the money that you lost. Put that money into a worthwhile project instead of one that will slowly whittle its way down to nothing.

It can be difficult to follow signals

Even if you do somehow manage to get legit signals it can actually be difficult to follow them. This is likely true for anyone looking to buy these trading signals since most everyone who would do it is someone who is new to crypto trading.

You might not be able to make a profit even if you have good information, because you won’t actually know how to use the information that you’ve purchased. You’ll still need to know how to read these signals and investors with no knowledge of this area will be lost here.

So, what should you do instead?

Instead of trying to take a short cut and buy signals from someone you should instead learn how to evaluate the market on your own. Spend some time browsing the internet to find tutorials on technical and fundamental analysis.

There are plenty of beginner techniques that you can learn with minimal effort to start making better trades today. This comes with the added bonus of not having to trust or rely on others for your information because you can get it yourself.

Use your new skills to vet your own investments and don’t bother with trading signal scams which are only out to steal your money. Invest in solid projects that can offer steady returns over the long term rather than looking for fast profits in an area where you have no idea what you’re doing.

Can you do anything if you’ve been scammed by a signal group?

Not really. You could try reporting their accounts on social media, but they’ll just make more. There’s no way to recover your cryptocurrency if you paid them, and these traders will likely be anonymous so there’s no real recourse for you.

Your only real option here is to make better choices next time, and perhaps you could warn others about what they’re doing to at least slow their influx of victims. Though you’ll never stop everyone. Free money, no matter how unrealistic the offer, is just too appealing for many to pass up.