5 Crypto Scams Beginners Often Fall For

The crypto world offers exciting opportunities, but it also attracts scammers eager to take advantage of beginners. With promises of instant wealth and secret trading hacks, these schemes are designed to trick you out of your hard-earned money. Let’s break down the most common crypto scams so you can recognize the red flags and stay safe.

1. Fake Giveaways

You’re scrolling through social media, and there it is: a post from a “crypto influencer” or a well-known brand promising to double your Bitcoin if you send them some first. Sounds amazing, right?

How it works: Scammers pose as celebrities, crypto companies, or influencers, offering “giveaways.” They post flashy graphics and fake testimonials to lure victims. Once you send your crypto, it’s gone forever.

How to avoid it:

• No legitimate company or individual will ask you to send money to receive more.
• Verify social media accounts. Scammers often create fake accounts with subtle name changes.
• If it sounds too good to be true, it is.

2. Phishing Scams

Crypto phishing scams aim to steal your private keys, wallet login details, or recovery phrases.

How it works: Scammers send emails, messages, or even fake websites mimicking popular exchanges or wallets. They’ll claim there’s an issue with your account and urge you to click a link to “fix” it. That link takes you to a fake website designed to steal your credentials.

How to avoid it:

• Always double-check URLs. Official sites often end with “.com” or “.io.”
• Never share your private key or recovery phrase. No legitimate service will ever ask for it.
• Enable two-factor authentication (2FA) on your accounts.

3. Pump-and-Dump Schemes

This scam involves artificially inflating the price of a cryptocurrency to lure investors and then dumping it for a profit.

How it works: Scammers promote a small, obscure cryptocurrency, claiming it’s about to “moon.” They coordinate buying to push up the price, creating hype. When enough people jump in, they sell off their holdings, causing the price to crash and leaving investors with worthless tokens.

How to avoid it:

• Avoid coins that are heavily promoted by influencers or random strangers.
• Research the project thoroughly before investing.
• Be wary of sudden price spikes with no real news or development to back them up.

4. Fake Investment Platforms

These scams promise huge returns through “crypto trading bots” or “guaranteed profits” if you invest with them.

How it works: You’re invited to a slick-looking platform that claims to trade crypto for you. They might even show fake testimonials or fabricated profit charts. At first, you may see small “profits” to build trust. But when you try to withdraw your funds, they either disappear or demand more money in “fees.”

How to avoid it:

• There’s no such thing as guaranteed returns in crypto.
• Research the platform thoroughly. Are there reviews from trusted sources?
• Stick to well-known and regulated platforms for trading and investing.

5. Rug Pulls

A rug pull happens when a project raises money from investors and then suddenly shuts down, taking all the funds with it.

How it works: Scammers launch a new token or NFT project with grand promises. They hype it up through social media, influencers, and ads. Once people invest, the team vanishes, and the project collapses.

How to avoid it:

• Check the team’s background. Are they public and credible?
• Look for an audit of the project’s code to ensure it’s secure.
• Be cautious of projects with no clear use case or roadmap.

Final Thoughts

Crypto scams prey on greed, curiosity, and a lack of knowledge. The best way to protect yourself is to slow down, do your research, and never trust anything that promises quick riches. If you’re ever unsure, take a step back and ask questions — or consult someone you trust in the crypto community.

Stay alert, and remember: in crypto, it’s better to miss out on a “too good to be true” deal than to fall for a scam.

5 Crypto Scams Beginners Often Fall For was originally published in The Capital on Medium, where people are continuing the conversation by highlighting and responding to this story.