Most Common Crypto Scams and How To Avoid Them

Losing your coins to scams is easy if you’re interested in crypto investments. There are many fraudsters that would do anything to deceive investors to steal their digital assets. Some go to the extent of building fake wallets while there are others that phish for private keys. In this post, we shall look at the ways to keep your cryptocurrency safe.

Scam ICOs

Even though it is not easy to identify some scam ICOs, there are signs with which scam ICOs are known. For instance, a project that would not list the team behind it is most likely a scam. It is obvious that when fraudsters set up a crypto project, they have no plan of revealing their identities because they wouldn’t want the people and law enforcements coming after them when they pull down their sites and turn exit scams.

If the project is a Proof of Work (PoW) or Proof of Stake (PoS), there are indications that you could use to know if you’re dealing with a scam. The first is checking if the coin is pre-mined. Did the whitepaper and website state that it is and what reason was given? If they intentionally concealed the fact that it was pre-mined, you can conclude that you’re dealing with a scam. To identify their pre-mine figure, visit their explorer and

 According to Tranthidon on BTT, typing the number ‘one’ on the explorer would give you the result of its first block. This should give you an insight that you’re dealing with a likely scam if there is no mention of the premined coins. Comparing this data with the information on their site and whitepaper would show if you should avoid it.

Sale of Fake Coins

Fraudsters could sell fake coins to unsuspecting investors. This is why it is important to always check the contract address of any coin that was offered to you to make sure that its contract address of the coin is the same as that of the smart contract.

Social Media Coin Scam

Perhaps, you’ve come across messages on Twitter that asks people to send small volumes of ether to receive larger volumes such as “Send 0.1 ether, you’ll receive 1 ether. Even though this should be obvious scam, there are many people that still fall for them. You should know that every investment that promises easy money is fraudulent.

Airdrop Phishing Scam

In this type of scam, the fraudsters send outreach to prospective investors inviting them to participate in airdrop by clicking on a link. This link contains a phishing form with which the scammers hope to use in gaining access to the private keys of the users. Sometimes, respondents are asked to import private keys. At other times, they use key-logging techniques to gain access to passwords of respondents.

Here’s an example of a scam airdrop email:

“Hello dear participants and users of Stellar Term!

We are in a hurry to inform you that we are giving out to our users $ 125,000,000 in XLM form to absolutely every participant.If you are not a user of the Stellar Term wallet, you can fill out an application in our registration form to get the right to participate in the AirDrop program.

In our registration form you will find a link to the updated version of Stellar Term, and after all the conditions are met and our Stellar Term is installed on your Windows, you will immediately receive 1000 XLM coins to the address you specified in the form.

 Registration form:

Thank you for participating in the program!

Stellar Term”

The above could be seen as the scam it is because of the grammatical errors such as “term” as team. The sending email address is which is an obvious giveaway since no team would use free email accounts for community correspondence.

Phishing Crypto Websites

Fraudsters sometimes clone popular crypto sites with the intention of deceiving users. Their objective is to use the fake sites to phish for passwords and private keys of users who are deceived thinking that they’re dealing with the genuine site. Losing your password or private key is as bad as losing your digital assets.

Used Hardware Wallet Scam

Could you imaging buying a hardware wallet that has been used by another, not knowing that the previous user already has generated and had seeds filled out? The consequence is that the previous owner could access the wallet and steal the funds in it.

Another variant of this scam is wallet opening service scam. In this type of fraud, scammers offer to open free wallets for people with incentives such as helping them mine bitcoins. The fraudster’s intent is to take control of the seed and steal any digital assets that the owners put in them down the line.

Online Seed Generator Scam

Platforms such as IOTA require personal seed generation. Seed generating sites come in handy for such platforms. Unfortunately, there are scam sites that would store the generated seeds and later target the funds of users that used such sites. This is why seed generation must not be publicly done in conjunction with any other website.

Malicious Codes and Trojans

There are malicious programs that could gain access to the device of users. For instance, Saefko is a trojan based on Microsoft.NET. Most common malicious codes target Microsoft. This is why it is important to be cautious before installing any programs on your device, especially devices that are used in transacting cryptocurrencies.

According to Zscaler ThreatLabz, the cybersecurity firm that discovered the malware,

“RATs are usually downloaded as a result of a user opening an email attachment or downloading an application or a game that has been infected. Because a RAT enables administrative control, the intruder can do just about anything on the targeted computer, such as monitoring user behavior by logging keystrokes, accessing confidential information, activating the system’s webcam, taking screenshots, formatting drives, and more.”

Clipboard Malware

This is one of the scary malicious codes that switch the address of the recipient of a transaction. The bug works this way: when you copy the address you want to send crypto to, it changes it to the scammer’s address making the new address similar to the one you initially copied. This makes it difficult for you to detect swap. When you hit the ‘send’ button, the fund goes to the fraudster’s wallet.

HYIP and Ponzi

Although these should be obvious scams, there still are people that participate in such schemes with the hope of making gains. However, the main beneficiaries of these scams are the owners. All HYIP and ponzi are scams and must be avoided.


There are many fraudsters working hard to steal people’s assets. This is why you should do all that is necessary protect your funds. This post is by no means extensive so due diligence is necessary before sending your crypto to any address.




Author: Jofor Humani

Jofor is a crypto journalist with passion for investigative reviews.

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