While we’d love to live in a digital world where everyone plays fair, crypto scams do exist, and you need to be aware of them. As the cryptocurrency industry grows, so too will the potential threats of scams, theft, and fraud.
What can you do about it?
Well, awareness is your first line of defense. That’s what we’ll cover today. Read on to learn more about crypto scams, the common types you might encounter, and how to spot them.
Before we dive into the different types of scams you should be aware of, let’s talk about a few key distinctions.
There are two main types of scams you’ll often see in the crypto world:
These two types cover a wide range of common scams.
You’ll see these not only in crypto but across virtually every digital space as well. So, it’s good practice not to just keep an eye out for these in your crypto actions but also in your everyday life.
Now, let’s start digging into some more specific types of crypto scams.
What’s wrong with a little bit of love?
Well, in this case, quite a lot. Scammers often target individuals on dating platforms with the goal of developing a fake romantic relationship to access crypto wallets.
Should you be wary of every possible love connection? Well, no. But, there are a few warning signs that should put up some red flags — these will be common across most of the scams we explore today:
If you see a few or even just one of these signs, it might be time to cut ties. Trust your intuition. If things feel off, end the conversation and report the user on the platform.
Up next on our list is a big category to be aware of: social engineering scams* (learn more at morganstanley.com).
These are the types of scams that play on your best and worst impulses. Basically, a social engineering scam is when a fraudster pretends to offer an amazing opportunity or present themselves as people in dire need of help.
A common part of a social engineering scam is a fabricated sense of urgency, tricking you into making hasty decisions.
An example of this type of scam is a business deal that’s too good to be true.
The scammer plays on emotion, often targeting greed or generosity. Here is what to look out for:
As a rule of thumb, if something sounds too good to be true, it often is. This is a strong indication of a scam. Moreover, if someone you don’t know is asking for personal information, especially financial details or your crypto wallet’s private keys, be extremely cautious.
Just as with romance scams and most scams in general, trust your instincts.
Do your due diligence and research as much as you can. Genuine opportunities won’t pressure you into quick decisions.
One of the more classic internet scams, phishing scams are when attackers impersonate trusted entities to trick you into revealing sensitive information.
The goal is to get you to reveal your passwords, wallet details, or private keys.
They’ll create fake websites that resemble legitimate crypto exchanges or wallet providers. They also often send fake emails or text messages that look authentic to lure you into clicking malicious links or downloading harmful attachments.
Here are the warning signs:
If you think you may be seeing a phishing attack, stop and first verify the source. Don’t download any suspicious files, and be sure to report the attack if you can through your email or text provider.
A good security practice is to use two-factor or multi-factor authentication.
This will add an extra layer of security to your accounts, making it harder for scammers to gain access even if they get your password.
Rug pulls* (learn more at coinmarketcap.com) are when the leaders of a project “pull the rug” out from under investors, taking the capital that has been raised. These are usually new, unverified cryptocurrency projects that are listed on exchanges with artificially inflated trading volumes.
This is a greater threat to investors than everyday users, and frankly, only to those investors who tend to take huge risks.
Even so, it’s a common occurrence in the crypto world and should be understood.
Here are some of the warning signs:
It can be easy to get involved in a rug-pull scam if you’re not careful. While the world of cryptocurrency is becoming mainstream, there are still those on the fringes who mean to do harm.
That’s why many users stick to qualified and trustworthy projects like Bitcoin or Ethereum.
While there are still risks involved in investing in these coins, you don’t have to worry about the developers running off with your money and leaving you high and dry.
In these scams, fraudsters impersonate legitimate crypto companies, exchanges, or wallet services. They will try to connect with you through social media, email, or other channels and offer fake promotions or giveaways.
The goal is to get you to send over crypto as an investment or deposit. Once you send the coins over, though, you’ll never receive the promised reward.
Look out for these warning signs:
This attack is similar to a phishing attack, but instead of your personal information, the goal is to trick you into sending over your hard-earned crypto.
Never send crypto over for the promise of more crypto. This should be a major red flag.
If you think the giveaway is legitimate, do your research first. Look at verified accounts on social platforms or the actual website to confirm before you do anything.
There are thousands of different types of scams out there. We’ve covered some in-depth, but here are a few more to keep an eye out for:
While our list of crypto scams might seem big, it’s just scratching the surface. In reality, there are thousands of ways scammers may try to take advantage of you.
To help you out, here are a few general protection tips to protect yourself:
The best approach to cybersecurity is to be proactive.
That means following these tips and building your own intuition on what feels right. Being reactive means trying to solve problems after events have occurred, which, as you can imagine, means damage is already done.
Remember, the crypto space is still very new.
While scams, fraud, and theft certainly occur, if you pay attention and practice cybersecurity safety, you’ll be in a good position to avoid them.
So there you have it: common crypto scams and what to watch out for.
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Note: This blog was updated on 3/10/25, original post date 3/24/23