Cryptocurrency Scam Prevention
Protect yourself from cryptocurrency scams and fraud. Learn to identify common scam tactics, red flags, and how to verify legitimate projects and platforms.
The Cryptocurrency Scam Landscape
The cryptocurrency space, while innovative and promising, has unfortunately become a target for scammers due to its decentralized nature, irreversible transactions, and the general public's limited understanding of the technology.
Alarming Statistics: In 2022, cryptocurrency scams resulted in over $5.6 billion in losses globally, with the average victim losing $2,600.
Common Cryptocurrency Scams
Phishing Scams
Fraudulent websites and emails designed to steal your login credentials and private keys.
Common Tactics
- • Fake exchange websites
- • Urgent security alert emails
- • Fake wallet recovery services
- • Social media impersonation
- • Fake customer support
Red Flags
- • Suspicious URLs (typos, extra characters)
- • Requests for private keys/seeds
- • Urgent action required messages
- • Poor grammar and spelling
- • Unsolicited contact
Ponzi & Pyramid Schemes
Investment schemes that pay returns to earlier investors using money from new investors.
Warning Signs
- • Guaranteed high returns
- • "Risk-free" investments
- • Pressure to recruit others
- • Complex or secretive strategies
- • Difficulty withdrawing funds
Examples
- • High-yield investment programs
- • Multi-level marketing schemes
- • Fake mining operations
- • "Guaranteed" trading bots
- • Referral-based platforms
Fake ICOs & Token Sales
Fraudulent Initial Coin Offerings that collect funds but never deliver on promises.
Red Flags
- • Anonymous or fake team
- • Unrealistic promises
- • No working product
- • Plagiarized whitepaper
- • Pressure to invest quickly
Due Diligence
- • Research team backgrounds
- • Read the whitepaper carefully
- • Check for working prototype
- • Verify partnerships
- • Look for third-party audits
Rug Pulls
When developers abandon a project and run away with investors' funds.
Types
- • Hard rug pull (steal funds directly)
- • Soft rug pull (dump tokens gradually)
- • Liquidity rug pull (remove liquidity)
- • Honeypot (can't sell tokens)
Prevention
- • Check liquidity lock status
- • Verify contract ownership
- • Look for audit reports
- • Test small transactions first
Social Engineering Attacks
Romance Scams
Scammers build romantic relationships to manipulate victims into sending cryptocurrency.
Common Patterns
- • Profiles with stolen photos
- • Quick profession of love
- • Claims to be traveling/military
- • Avoids phone/video calls
- • Financial emergencies
Protection
- • Reverse image search photos
- • Insist on video calls
- • Never send money to strangers
- • Be skeptical of sob stories
- • Trust your instincts
Impersonation Scams
Scammers impersonate celebrities, influencers, or support staff to gain trust.
Common Targets
- • Elon Musk, celebrities
- • Exchange support staff
- • Government officials
- • Crypto influencers
- • Technical support
Verification
- • Check for verification badges
- • Contact through official channels
- • Look for follower count/history
- • Be skeptical of giveaways
- • Never send crypto first
Tech Support Scams
Fake technical support that claims to help but actually steals your funds.
Tactics
- • Unsolicited help offers
- • Claims of wallet issues
- • Requests for screen sharing
- • Asks for private keys
- • Urgency and pressure
Remember
- • Real support never asks for keys
- • Always contact official support
- • Don't share screen with strangers
- • Be wary of unsolicited help
- • When in doubt, hang up
How to Verify Legitimacy
Research Checklist
Team & Company
- □ Real names and photos
- □ LinkedIn profiles
- □ Previous work history
- □ Company registration
- □ Physical address
Project Details
- □ Clear use case
- □ Working product/demo
- □ Realistic roadmap
- □ Active development
- □ Community engagement
Technical Verification
Smart Contracts
- • Contract source code verification
- • Third-party audit reports
- • No hidden functions
- • Ownership renouncement
- • Liquidity lock status
Website & Communications
- • Professional website design
- • SSL certificate
- • Official social media
- • Regular updates
- • Transparent communication
Community & Reviews
Community Feedback
Check Reddit, Discord, Telegram for genuine user experiences
Third-Party Reviews
Look for reviews from reputable crypto news sites and analysts
Warning Signs
Be wary of only positive reviews or suppressed negative feedback
If You've Been Scammed
Immediate Actions
Stop Further Losses
Immediately secure remaining accounts and assets
Document Everything
Save screenshots, transaction IDs, and communications
Report the Scam
Contact authorities, exchanges, and scam reporting websites
Reporting Resources
Government Agencies
- • FTC (Federal Trade Commission)
- • FBI IC3 (Internet Crime Complaint)
- • Local law enforcement
- • Financial regulators
Community Resources
- • Scammer.info
- • Reddit scam communities
- • Exchange support teams
- • Crypto security forums
Scam Prevention Checklist
Before Investing ✓
- □ Research team thoroughly
- □ Verify all claims independently
- □ Check for working product
- □ Read community feedback
- □ Start with small amounts
Red Flag Awareness ✓
- □ Too good to be true promises
- □ Pressure to act quickly
- □ Requests for private keys
- □ Anonymous teams
- □ Guaranteed returns
Strengthen Your Security Knowledge
Combine scam awareness with comprehensive security practices for complete protection.