Crypto Scams And How To Avoid Them
Learn how to spot phishing attacks, rug pulls, and fake token sales, plus essential security tips to protect your Avalanche assets and avoid losing your hard-earned funds.
Crypto is full of opportunity but also a playground for scammers. As the overall blockchain space and Avalanche ecosystem grows, so does the amount of scams targeting unsuspecting users. We’ll explore basic crypto security, break down classic scams, reveal newer and more sophisticated schemes, and share tips on how to recognize and avoid these scams so you don’t lose your hard-earned tokens.
Basic Crypto Security
Use Reputable Wallets: Download reputable wallet apps and always treat your wallet like your personal bank vault. The Core Wallet is the preferred wallet for the Avalanche blockchain. You can download it here: core.app.
Keep Your Keys Private: NEVER share your seed phrase — this is the key to your funds.
Use Hardware Wallets for Big Sums: For larger amounts and long-term storage, opt for hardware wallets like Ledger or Trezor.
Verify Communication: Bookmark official URLs and double-check emails or messages claiming to be from your wallet provider.
Avoid Suspicious Attachments: Do not open attachments from untrusted sources on social media or email.
Employ Anti-Malware Software: Use anti-malware software such as Malwarebytes to guard against malicious threats.
Enable Two-Factor Authentication: Secure your exchange and social accounts with 2FA for an extra layer of protection.
Classic Crypto Scams
Some scams have been around almost as long as crypto itself. Here are a few that continue to catch people off guard:
Phishing Scams
Scammers send fake emails or messages that mimic legitimate services, urging you to click on a link or download a file and enter personal information. These messages often use urgent language and attractive offers to trick you into giving up your personal details. Remember, unless you reach out to customer service first, most of the time these service providers will not contact you for any reason.
While phishing scams are getting harder to spot, there is usually something wrong with the message. Look for typos, strange logos, blank profile pictures, or questionable URL links. It’s also important to note that with some attachments, scammers can steal your coins just by opening the file or clicking on the website - so please be careful.
Ponzi / Pyramid Schemes / Yield Farming Scams
Promising insane returns, these scams lure you in with the promise of high profits. However, these schemes rely on new investors to pay off earlier ones, and when the influx stops, everyone loses and the team usually shuts down the project. Scams like these are less prevalent than a few years ago, but if a face melting bull run returns, you can bet they will surface again. If you see “1,000% APR,” it might be fair to assume it’s a ponzi or yield farming scheme, and more often than not, you will be the exit liquidity.
Fake Token Pre-Sales
Fraudsters launch bogus token sales, convincing you to send them money for tokens that simply never launch. You’ve probably seen a flurry of legitimate token presales on Avalanche (Ket, Wink, Blub), and as these pre-sales increase in popularity, you can expect the number of scams to also increase. Always make sure you know exactly who the team is before sending tokens to anyone. If you aren’t friends with an account, aren’t familiar with their posting history, or the account is brand new, it’s a good idea to stay away.
Rug Pulls
In decentralized finance (DeFi), NFT projects, and PumpFun coins, scammers create a seemingly promising project, attract investors, and then suddenly withdraw all the funds, leaving you with worthless tokens. This is probably the quintessential crypto scam. Pump.Fun has become notorious for rug pulls, and unless you are a seasoned meme trader, it’s probably a good idea to stay away from the trenches.
Newer and More Sophisticated Crypto Scams
As crypto advances, so do the scams. These newer scams often blend technical tricks with social engineering to target even the savviest users:
Combined Attacks
One of the most advanced scams I’ve seen happened to crypto YouTuber “House of Crypto.” It began with someone claiming to be from a well-known news outlet reaching out to him on X, wanting to do an interview about his YouTube channel. He did his due diligence and looked into their LinkedIn profiles and they looked legit. The scammers scheduled a video interview with him and he attended the interview. In the Zoom call, a window popped up and said the camera wasn’t working, and he clicked some additional setting buttons, which was probably the fatal mistake.
The scammers then made some additional requests, and he complied with them, which allowed them to gain full access to his computer. The scammers also got access to his X account and managed to scam some of his followers. I highly recommend watching the video below so you can see how far these scammers will go to gain access to your tokens. This is particularly important if you have a relatively large following on X.
Another combined attack recently happened to @jbawsa on X with 28.5k followers. As you can see below, scammers compromised one of his friend’s accounts, reached out to him, scheduled a podcast, and then sent him a phishing link. Boom, game over, just like that. I’m highlighting these cases because it can happen to anyone, no matter how experienced you are. And it is imperative that you have your guard up at all times.
Social Media Impersonations and Fake Giveaways
Scammers create fake profiles on platforms like X (Twitter) and Telegram, impersonating well-known influencers. They promote giveaways that ask you to send crypto in exchange for a “reward” that never comes. To avoid this scam, just don’t interact with anyone promoting a giveaway, especially if it requires you to send the scammer anything.
Honeypots
You buy a token from a fraudulent smart contract, but once you put your money in, the contract prevents you from selling the token and withdrawing your money. To avoid these scams, research the project thoroughly, verify that the contract has been audited, check community feedback, and never invest more than you can afford to lose. You can also check the contract address in Dex Screener (bottom right side) to make sure it isn’t a honeypot and for any other known issues.
Malware and Browser Extensions
Scammers create fake wallet browser extensions or apps that look legitimate but are designed to steal your private keys. Once your keys are compromised, your funds can be quickly drained. Only download browser extensions from trusted sources.
Final Thoughts
Crypto is awesome, but as with all great things, it has its drawbacks. With the right precautions, you can protect yourself from falling victim to scams. ALWAYS be skeptical of unsolicited offers, double-check website URLs, stick to reputable platforms, and remember to slow down when clicking buttons. The more you educate yourself about the various tactics scammers use—whether it’s classic phishing or the latest combined attacks—the better prepared you’ll be to navigate this rapidly evolving space.
Keep following Avalanche Team1 for more updates and deep dives into reputable Avalanche ecosystem projects.
Dive into the Avalanche ecosystem today! Download the Core Wallet and unlock a world of seamless DeFi, NFTs, and more.
 | A guest post by
|