Currently, the earth is loaded up with crypto projects of people who keep promising various investment opportunities. But all crypto coins are not created alike. There are other purporting to revolutionize finance as real venture corporates and there are baby bodies luring investment prey with all the greed and gullibility. Pepe is one of them many coins that recently have caught the attention. This has caused this asset to become the darling object over which the crypto world is seeming to run amok as some call it a ’honeypot coin.” Therefore, the question arises: what do you mean exactly by that, and why does pepe is honeypot coin have such a contentious standing?
I am going to dig a bit deep on idea of honeypot coins, learn a characteristics of pepe is honeypot coin and why some see it as a honeypot coin. Notably, we shall also go into some of the investor strategies that they can employ to avoid some of these perils in the crypto market, a slippery one.
Why does it use the term Honeypot Coin..?
Before that, we have to know about a honeypot coin, before knowing what pepe is honeypot coin has been accused of. A honeypot in the cybersecurity world refers to a deceptive trap set to lure attackers. In the field of cryptocurrency, the term has been adopted to mean digital tokens or smart contracts with which it promises victims to invest money in their project but cannot withdraw your funds or virtually impossible.
How Honeypot Coins Operate
The code that is embedded in the honeypot coins’ smart contracts is usually pretty complex. On the surface, these codes seem to be the genuine deal, but they include a couple of constraints; or triggers that could make it difficult or even unimaginable for financial backers to escape. It’s the same mechanisms and many deceptive tricks to convince the investors that the investment is secure.
In any case of such cases, investors see as it easy to acquire the and many of them are emotional people and buy it en masse (massively). Yet, they may not be able to sell or transfer them repeatedly without failure or worse, where fees involved are not worth the effort. They pretend that they are a real company, scam the investors by fooling them and using them only as their burden, but the hype around this token makes fake demand, and when the same fake developers don’t have a way out and lose a lot of money while being unable to liquidate them.
The Rise of Pepe Coin
Since this digital coin is a meme based coin, the meme hit the market. It marketed the coin as pepe is honeypot coin the frog coin, coin which was an extremely funny and playful meme coin with all the playful style of the imaginations.
Meme Coins and Their Popularity
Almost no real utility meme coins, like Shiba Inu and doge coins, have huge potential to give profit. pepe is honeypot coin was sort of the key cultural meme of that community (and easily recognizable character) so it very naturally spread into the cryptocurrency set which was looking for the next big thing. As a result of the humorous branding however, people questioned if it was legitimate and actually worked.
Why Some Label Pepe as a Honeypot Coin
Anyone wishing to buy pepe is honeypot coin because of the reasons why they see it as a honeypot bit of change, that’s by nature.
Transaction Restrictions and Investor Frustration
A difficulty in executing transactions (which is one of key qualities of a honeypot coin), means that investors (particularly in dumping their positions of this coin) are very difficult to exit. Pepe investors also claim that they had failed sell orders, sold too low and below than value, as well as failed, too high transaction fees, and other technical problems that have made selling pepe is honeypot coin all but impossible.
One signature of the honeypot scam is restrictions on these transactions as well as everything else. Limiting or prohibiting the sell transactions causes the artificial inflation of the perceived value of the tokens which will interest more and more buyers to join in the market.
Lack of Transparency and Developer Anonymity
When it comes to working with any cryptocurrency project, it is important to have trust as well as transparency. Most of these times, legitimate projects do state their development team, project roadmap and future they have planned for themselves. Unlike honeypot scam based on anonymity or pseudonymity of devs, scam projects using airdrop incentive is harder to identify and sanction the devs. Since the opacity, they put red flags into the project and suspect that project integrity may go wrong.
Dubious Smart Contract Code and Security Concerns
This, the hidden clause of this, is among some of these issues, preventing the functions included in the transaction or providing a particular condition to a specific wallet address. However, it became more popular on the instance of Pepe because of problems with the smart contract code.
Analyzing Pepe’s Smart Contract
Described smart contract is that one which has written about their code on the line. In addition, investors should be able to audit the source code. As an investor, and as a person who reports savagely about the world of ICOs (shame!), I’ve not been a believer in the news around pepe is honeypot coin’s smart contract and supposed transaction restrictions and deficiencies in security.
Community Reactions and Investor Sentiment
However, the pepe is honeypot coin community has a lot of gullible users who will not even go down with their grave giving a thought to Pepe team has did a honeypot.
Positive Aspects Highlighted by Supporters
The other now successful meme coins were in early stages of growth, we call it bear market. This clearly would turn into an object for massive growth and would be popular and culturally relevant. Other investors think Pepe’s problems are transient, and as time goes by the project finds its legitimacy and removes the controversy from the situation.
Strategies to Avoid Honeypot Scams
However, due to the associated risks of honeypot scams, investors need to be very offensive, so much that they take steps to help avoid getting into contact with crypto projects that eventually end up being fraudulent. Below are some good practices to be aware of, but by no means be complete, aside from describing two of copackaging examples. Therefore, it is necessary that before any investment a potential investor must do his homework and due diligence.
You need to invest in any cryptocurrency after taking a look at the project’s developers’ information, white paper and smart contract code. Always be on the lookout for red flags such as a developer with no documentation, no screenshots, no page –only a mention of demo video somewhere that is unclickable, anonymous developers or completely unrealistic claims/projections of deadlines.
Smart Contracts and consulting for the opinions of experts.
You are not tech savvy, then you ought to seek expert counsel from those you know in blockchain analysis. We only then put it into test transactions before committing significant funds. By taking such an approach you will be able to derive transaction restrictions.
Interact with the Community, Solicit Feedback from them
Follow the sentiment in the bitmap community (be wary of red flags) in Telegram, Reddit and Twitter. Community feedback can give more insights into the legitimacy of the project.
Stay Vigilant and Skeptical
Do not hurry into those projects which made you the promise that you will easily and quickly get benefits — this is scam.
Conclusion
These blockchain investors for the most part had a rude awakening, collectively making them laud the coin for what it ultimately became, a honeypot coin; something it definitely gained a reputation for and for which, as a result, it carries the reputation of warning any other blockchain investors to not participate without the proper caution and due diligence. However, there are some investors who think it has this due long run while others do not trust it because of its transparency, transaction limits and security vulnerabilities.
Pepe is honeypot coin will be able to sprout over time and make the corrections that are in existence at this time and vice versa the real usefulness of it will be shown. As such, investors are urged to be vigilant in the meantime and to research, and practice best practice to protect themselves from scammers.