How Can You Identify a Scammer When Trading Cryptocurrency?


A scammer can steal your cryptocurrency while trading without giving any hint. You might be focused on how to invest and trade your assets. But you will never focus on becoming a part of a scam unknowingly. In previous years, many frauds happened, and traders have lost millions in these scams.

You need to be aware of such issues that can happen to any trader while transacting digital currencies to anyone. You should know about standard crypto-based scams and how you can prevent them after identifying them.

It is not that difficult as you think. You have to be active while moving your assets from one wallet or account to another. Anyone can steal confidential information and misuse it to steal all your money. This write-up will help you know about such scammers and how one can protect the account from them.

Different Scam Types While Cryptocurrency Trading

1. Fake Sites


It is pretty common for scammers to create fake exchange platforms and wallets to trap victims. Many people create an account and deposit money to start trading without knowing the reality of the platform. Whatever information you share on that site, the scammer can get it all and use them to steal your money.

Sometimes, you will feel like you are using a highly-protective website, but unknowingly, you will get trapped. It is quite challenging to tell the difference between genuine and fake sites. These fake sites can be operated in two ways:

Webpage Phishing: When you enter anything on the phished page, the scammer can access the entire information, and everything will end afterward.

Direct Theft: When you invest little money in the beginning. While trading perfectly, you will deposit more money to trade more. When you are about to withdraw the amount, your account will shut, and you will lose all your money.

2. Phishing Scams

The purpose of this scam is to target your wallet details. The scammers can access your wallet private keys and get funds from your wallet. Due to phishing the web pages as well as websites, they can get all the information. The user can get the email to change the wallet key for additional security. Once you change the private key details, the criminal will know everything.

3. Pumping and Dumping Method


A Fraudster can introduce any token or coin through social media. People will rush to purchase the coins and start investing their money. The price will increase, and people will think that it is profitable to invest more. After some time, the scammer will sell all their holdings and create a crash situation. The investors will see a sharp decline, losing their money.

4. Fake Mobile Apps

Traders use mobile applications for investing and trading virtual currencies. In many cases, the applications are fake on Apple as well as Google stores. It is easy to search these applications and eliminate them from the store. But scammers never stop creating such apps and launching them on the store.

5. Blackmailing


The scammer can ask for your wallet’s private keys by blackmailing. He can send threatening emails to the user. Due to the fear of getting exposed, many people share their confidential wallet details and lose their money.

6. Cloud Mining

Instead of buying expensive mining components, people prefer to get them for rent. The renting companies provide hardware, and the user has to share some revenue with them. But such companies are a scam, and they are getting your money with no profits.

7. Fraud ICO


The purpose of ICO is to raise some money for future investors, and it helps various new companies. If an investor invests his money in a new crypto asset, he gets a discount in exchange for the old crypto assets. But now, ICOs have also turned into fraud as they are providing nothing but getting expensive digital assets from you. They have fake office centers and marketing strategies to fool people.

How One Can Identify These Scams?


1. Promises to Get Guaranteed Returns

There is nothing fixed to get better returns whenever you make any investment. The crypto price can fall at any time. But if any offering is claiming that you will get guaranteed results, it is earning money from you.

2. Doubtful Whitepaper

You might have noticed that every crypto asset comes with a whitepaper, which is a primary part of the ICO. Everything regarding the digital currency is mentioned in the whitepaper, like its design, working, etc. Before investing, you have to check the whitepaper, and if it does not make sense, it can be a scam.

3. Too Much Marketing

Scammers may attract investors through too much marketing of digital assets. It can be through influencers, promotions, online advertisements, social media campaigns, etc. When people see the advertisements, they get attracted to make investments. Without any research, they purchase assets and lose all their money to scammers.

4. Getting Free Money

When any website claims to provide free cash for making a crypto investment, it can be a scam. The free money can be fake, and you will lose money through such an investment.

How Can You Protect Yourself from Scammers?


Wallet Protection: You need a digital wallet for transacting money for trading. It is protected with wallet private keys, and you do not have to share them with anyone.

Check the App or Website: While creating an account on any app or site, you must check it thoroughly. It should not seem fake.

Understand and Invest: Before you invest your money, you should do your research.

Invest Some Time: Scammers will let you deposit money quickly, and you have to avoid it. Instead, take enough time and understand everything before any investment.

Use Official Platforms: You should always use official trading platforms.


After knowing all the scam situations, you must follow the methods to identify crypto-based scammers. By using OKX, you can detect the current crypto price and know whether you should invest money or not. You have to be alert to prevent scams and protect your money from fraud.