Crypto Scammers: The Ultimate Guide to Identify and Avoid Crypto Scammers

The emergence of blockchain technology and cryptocurrencies has opened doors and profitable opportunities for the financial world. These benefits range from the convenience of transactions, decentralization of finance, and a significant source of income for many investors and traders, just to name a few. However, this technology has also created a safe haven for crypto scammers.

Cryptocurrency is one of the many ways to make money online with little to no effort at all. Despite that, many dishonest individuals have taken advantage of this new technology to fool newcomers and even seasoned investors into ripping them off of their hard-earned money.

If you are a crypto enthusiast and spend a reasonable amount of time on the internet, you have noticed how some people unrealistically depict the picture of what cryptocurrency is. Sadly, many folks fall for this trap and potentially lose their money.

This article will uncover who a crypto scammer is, how you can identify them, how they work, and most importantly, how you can avoid them. So, let’s dig right into it.

Who are crypto scammers?

Crypto scammers are individuals who use dishonest means to lure cryptocurrency owners into sending them their cryptocurrency. Crypto scammers can also use fraudulent ways to gain access to your personal wallet information and steal your money. Personal wallet information includes your passwords, secret seed phrases, and private keys.

Some crypto scammers will go to the extent of tricking you into investing in projects that turn out to be rug pulls. A rug pull is a form of crypto fraud where the creators of the project run off with the investors’ funds.

Crypto scammers range from cheap, dishonest individuals who send you spammy messages on Telegram and Facebook to highly sophisticated individuals who aim to refine their scamming business by innovating new and unsuspected ways they can implement to reap you off.

Who do crypto scammers target?

Crypto scammers usually eye the crypto newbies. Many newcomers are mostly misinformed because of the enormous amount of deceptive cryptocurrency posts they see on the internet. These posts feature a random stranger inviting people to invest a particular amount of money and make 10X or so returns in a very short time span. When you look at it, this looks stupid, but there are millions of undocumented cases of people who have fallen victim to this scheme.

Crypto scammers also target newbies since newbies don’t fully comprehend how blockchain technology works.

I am a victim of a crypto scam. My first interaction with Bitcoin was when I spotted a random post on Facebook asking people to spend 10 $ and make 10X returns the next day. At first, I did not give it a thought. But then, a few days later, I saw another guy upload a screenshot of his wallet’s transaction history. He had invested and made some pretty decent profits. So this built a picture in my mind that, to make a profit from bitcoin, you have to give your money to some intelligent guy to invest the money for you, and he sends the profits after making profits. Haha! Stupid, right? Well, maybe it is not; this is what many crypto newbies face at first. And the lack of the right information makes them a suitable target for crypto scammers.

Crypto scammers also target greedy investors who desire fast money. They will come to your social media inbox telling you how they have a new trading strategy or some sort of an intelligent trading bot that can make highly profitable trades within a short period. Well, if you are greedy, you could fall victim to your own greed.

Crypto scammers also target regular investors. This kind of crypto scammers will develop some ‘shitcoin’ project and try to get you to invest in them. They will cause huge spikes in prices, and after making the gains, they will withdraw their liquidity from the liquidity pool. Removing liquidity from the liquidity pool means that you cannot swap your coins for other valuable digital currencies. Yeah, so you probably remain with billions or perhaps millions of coins that are worth nothing because you cannot swap them for other valuable coins like Bitcoin and Ethereum. You remain with what we call ‘a rug’.

Highly sophisticated crypto scammers also target the general public. We have incidents of scammers who have hacked the Twitter accounts of high-profile personalities like Elon Musk and Kim Kardashian requesting individuals to send some amount of crypto to their wallets, offering to double the amount of the crypto that they contribute. Since these individuals are wealthy and the messages generated are from their own Twitter accounts, you might fall for the trick and potentially lose your crypto.

How do crypto scammers work?

Crypto scammers target major social media platforms and forums with a group of individuals interested in making money online and cryptocurrencies. Major networks they eye at include Telegram, Discord, and WhatsApp because of the personalized messaging nature of these platforms.

These scammers also create multiple fake accounts, which they use to post fraudulent information that is eye-catching at the same time.

Sophisticated crypto scammers develop crypto projects and convince individuals to invest in the project. When they gain a significant number of investors, they go ahead and run off with the investors’ funds. Sometimes they disable the ability to sell the tokens that you bought.

Crypto scammers with tech know-how employ phishing methods to acquire access to your personal information, including your login credentials for your favorite crypto exchanges and the secret seed phrases for your wallet.

How do you identify crypto scammers?

The good news is that spotting crypto scammers is easy. Some of the following red flags show that you are possibly talking to a crypto fraudster, and you should be on the lookout.

They offer you unreasonably excessive gains on your crypto investments-Crypto scammers will promise you a massive return on investment if you invest a particular amount of money in an unreasonably short period. If you are penniless and desperate for cash, you can fall prey to this trap. After all, human emotions are guided by two things, fear and greed.

If someone promises you an unreasonable return on investment and your thoughts go like, “hmm, too good to be true,” that clearly indicates that you are on the queue line of getting scammed.

They ask you to send them your coins to trade for you – Crypto scammers will ask you to send them your hard-earned money so that they can trade for you. They usually tell you how they have made lucrative trades for their clientele over the years, even in the bear market.

They do not accept any payment forms other than bitcoin-Crypto scammers do not accept any other payment methods like a bank account transfer apart from bitcoin and other cryptocurrencies. Unlike bank transactions, bitcoin transactions cannot be reversed or canceled. Once you press the send button, it is a closed deal.

There is very little that the authorities can do after being scammed because bitcoin transactions are anonymous. There is no name of an individual or a physical address associated with a bitcoin transaction.

They have fake social media accounts with zero followers and zero posts- Most scammers have fake social media accounts, which do not have any following. Most of these accounts are likely new or a few months old. These accounts also do not have any posts, and if they do, they include pictures of money and screenshots of false earnings.

Their profile pictures are always distinguished by good-looking models and entrepreneurs ‘in suits.’ Sometimes they are pictures of bitcoin and different fiat or digital currencies.

They are the ones who message you first-Yes, they will be the first to send you a message first, and when they do, they will start pitching you their ridiculous get-rich-quick schemes.

Crypto scammers will ask for your wallet’s private key or secret key

They stop replying to your messages and calls immediately after sending them your bitcoin. Immediately you send scammers your money; they will block you or delete their social media account.

They tell you that they can mine bitcoin for you-Crypto scammers will try to convince you to send them money so that they can mine bitcoin for you. The amount of money you send them is not used to buy any mining infrastructure but to support their devious business model.

They ask for your wallet or exchange information-Some crypto scammers have the audacity to ask for your personal information like login credentials for exchanges and secret seed phrases for your wallet. To be on the cautious side, let this information stay private.

How can you avoid crypto scammers?

While crypto scams could make you apprehensive about tipping your toes into the cryptocurrency world, it turns out that they are pretty easy to avoid. The following are the strategies you can utilize to prevent crypto scams.

  • Avoid communicating to anonymous persons who claim to mine or trade bitcoin for you on social media. These are the cheapest types of scammers and they should just be ignored.
  • Countercheck the URL of crypto-related websites that you are visiting. Make sure that the domain extension of the websites is correct while visiting them. Not doing so might land you on scammy websites, and you will be placing yourself at risk of getting scammed. 
  • Avoid clicking on crypto-related advertisements on google. Some individuals run google AdWords on the crypto keywords you are searching for. Clicking on these ads might land you on phishing websites, leading you to fraudulent activitities.
  • Avoid websites that solely ask for bitcoin as a means of payment; they do this because they know that blockchain transactions cannot be reversed or revoked. Additionally, no one is accountable for any bitcoin transactions you make to a website, and thus, the loss cannot be recovered even if you report it to the authorities.
  • Avoid people who offer to sell your cryptocurrency off exchanges at a lower price. There is no harm in selling your cryptocurrencies on major exchanges and secure p2p platforms like Binance and LocalBitcoins. So, why should they avoid them? We all know the answer.
  • Avoid crypto transactions that are not escrow protected. Crypto scammers detest escrow transactions, and they will avoid them at all costs. An escrow secures P2P transactions by ensuring that both parties involved in a P2P trade keep their share of the contract without double-crossing one another.
  • Only trade with individuals having a high trust score rating on p2p exchanges. The reviews area might give you valuable insights about who you should or should not trade with.
  • Stay away from the crypto giveaways that ask you to pay a certain amount of cryptocurrency to a particular address. You don’t need a second brain to know that this is too good to be true.
  • Avoid spamming crypto-related groups on social media that beg you to invest money on a particular website promising returns after a few hours a day or a few days.
  • One hundred percent of the time, these are essentially Ponzi schemes that use the latest investors’ money to pay the first investors. That is why you will see some few individuals happily post screenshots of their payouts; this will definitely entice you to submit your money to the website, and that is how you will get scammed. Well, don’t do it because when fresh investors stop streaming in, there will be no income for the website, and the scammers will be likely to run off with the funds of the current investors’ money.
  • Don’t reveal your bitcoin wallet’s private key or secret phrase to anyone. Additionally, be wary about where you get your wallet from; the source of a crypto wallet should be on its official site. If you are using a mobile wallet, look out for any modifications in the wallet’s logo and the name. The reviews area might also give you some clues into the credibility of the wallet program you are about to download.
  • Avoid shitcoins. Many well-established crypto projects are quite safe to invest in. Personally am very picky when it comes to selecting a coin to invest in. I am not a financial expert, but the top 100 coins have some outstanding potential, and you can invest in them. Many individuals choose the low market cap currency because they hope that the next bitcoin might emerge from them. Most of them are shitcoins, and with the amount of money you are spending on them, you could make good use of it by expanding your holding of valuable real-world coins that have some potential.
  • Strictly buy cryptocurrencies from reliable providers like Coinbase and Binance.

A crypto scammer has defrauded you; what next?

So you have noticed that you just got scammed. What should you do? Okay, let us first talk about what not to do when you get scammed. Don’t resort to social media seeking guidance regarding how you can get your money back. Doing this will land you on advertisements that will expose you to additional scammers, who claim that they can help you recover your bitcoin or any other cryptocurrency that you were scammed, for a fee, of course.

It is exceedingly unlikely to recover your bitcoin once you have sent it to a crypto scammer. It will help if you read about cryptocurrencies and how it works to stay informed and avoid such unattractive occurrences in the future.

If your bitcoin is stolen and you are a victim of a crypto scammer, you can report the matter to the authorities to investigate it, but there is so little they can do to recover your money.

Conclusion on crypto scammers

Being a victim of a crypto scam, I am passionate about educating people about detecting and avoiding crypto scammers. The key to avoiding crypto scams is reading and knowing how bitcoin and other cryptocurrencies actually work. Instead of sending random strangers your money and asking them to trade for you on the internet, why not learn the skill by taking trading classes on Skillshare or reading a trading book.

I highly recommend Skillshare. Skillshare is an online learning platform with countless individuals who are passionate about teaching you any skills you want to learn. The skills offered on the platform include day trading, article writing, investing, drawing, and honestly, the list is endless. Create a Skillshare account here.

If you wish to invest in Bitcoin, you don’t need a third-party individual to invest for you. Simply buy bitcoin on reputable exchanges like Binance and Coinbase, and hold the coins in your wallet. Take caution when choosing a wallet. I have heard of situations where scammers are now trying to duplicate the logos and functionality of the original crypto wallets and post them on the Play store. This creates confusion, and many users end up using the clone wallets and losing their money.

Finally, it is essential to note that, no one is immune to crypto scams. Crypto scammers devise new and innovative ways of scamming you. You should take extra caution because what we have discussed in this article is just a tip of the iceberg and not the whole thing.

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