Common Crypto Scams & How to Avoid Them
Crypto scams stole over $14 billion in 2021 alone. Understanding common scam tactics is your best defense. Here are the most dangerous scams and how to spot them.
If it sounds too good to be true, it IS a scam. No one is giving away free crypto. No one can guarantee returns. Ever.
1. Phishing Attacks
Fake websites and emails that steal your credentials:
- Fake exchange sites - coinbase-secure.com instead of coinbase.com
- Fake wallet apps - Malicious apps in app stores
- Email phishing - "Your account is suspended, click here"
- Social media DMs - Fake "support" accounts
How to Avoid
- Bookmark official sites, never click email links
- Check URL carefully (typosquatting: binace.com)
- Official support NEVER DMs you first
- Use hardware wallet for transaction signing
2. Fake Giveaway Scams
"Send 1 ETH, receive 2 ETH back" - This is ALWAYS a scam:
- Fake celebrity accounts (Elon Musk, Vitalik)
- Hacked YouTube channels running "live" streams
- Comment bots on social media
- Fake "official" announcements
Real airdrops are free. Anyone asking you to send crypto to receive crypto is scamming you. 100% of the time.
3. Rug Pulls
Developers abandon project after taking investor funds:
- New token launches with huge promises
- Influencer promotion creates hype
- Liquidity added, price pumps
- Developers drain liquidity, token goes to zero
Warning Signs
- Anonymous team
- No audit of smart contract
- Unlocked liquidity
- Too-good-to-be-true APY
- Aggressive marketing, celebrity endorsements
4. Romance Scams ("Pig Butchering")
Long-term manipulation scams:
- Meet on dating app or social media
- Build relationship over weeks/months
- Introduce "amazing investment opportunity"
- Show fake profits on fraudulent platform
- Victim invests more, eventually loses everything
If someone you met online brings up crypto investment opportunities, be extremely suspicious. This is the #1 scam pattern.
5. Fake Support Scams
Impersonating customer support:
- You post about an issue publicly
- Scammer DMs pretending to be support
- Asks for seed phrase to "verify" your wallet
- Funds drained immediately
Remember
- Real support NEVER asks for your seed phrase
- Real support NEVER DMs first
- Always use official support channels
6. Pump and Dump
Coordinated price manipulation:
- Group buys obscure low-cap token
- Price pumps, attracts attention
- FOMO brings in outside buyers
- Original group dumps, price crashes
- Late buyers left holding worthless tokens
7. Malicious Smart Contracts
Contracts designed to steal funds:
- Unlimited approval - Contract can drain entire wallet
- Hidden mint function - Dev can create unlimited tokens
- Honeypot - You can buy but can't sell
Regularly check and revoke token approvals at revoke.cash. Old approvals to compromised contracts can drain your wallet.
Red Flags Checklist
- Guaranteed returns or "risk-free" investments
- Pressure to act quickly ("limited time!")
- Unsolicited contact about investment
- Request for seed phrase or private keys
- Anonymous or unverifiable team
- No working product, just promises
- Celebrity endorsement (often fake)
If You've Been Scammed
- Don't send more money (even if promised recovery)
- Document everything (screenshots, addresses)
- Report to local authorities and FBI IC3
- Report scam addresses to blockchain explorers
- Warn others in community