How To Find Out If Your Cryptocurrency Service Is A Scam


Published on June 30th, 2022

Cryptocurrency services come in many shapes and forms today. They rarely provide a single service. Most of them combine crypto wallet, cryptocurrency exchange, token swap, savings account, staking, liquidity pools, and other financial services.

While attracting new customers they hawk low fees and high yields. But in the industry where 100% APY is considered “just okay”, it’s easy to fall prey to scammers.

Brutal And Subtle Scams

Scams are never easy to spot, especially in the world of cryptocurrencies. When the entire industry is based on new tech, pushing the envelope, and revolutionizing the world of finances, it’s not easy to differentiate which projects are millionaire-makers and which are ruthless scams.

Many brutal scams rely on pure greed and recklessness on the part of the customers, so they can be avoided. Often old schemes (like Ponzi) are adapted for the world of crypto.

However, some services look, sound, and pose as legit businesses, but are either long-con scams or are doomed to fail, making them sort of inadvertent scams.

While in other fields of investment, there are plenty of insurances, rules, and regulations, in the world of decentralized finances (DeFi) and crypto, it’s almost impossible to insure against risk or have your funds back from the scammers.

Very commonly, pages that pose as trading bots can turn out to be scams, such as the Bitcoin union trading soft review. This is, sadly, just one of many trading bot scams out there, so you’d better take care.

Reputation Is Everything

There is a reason that the same names crop up when it comes to crypto exchanges or other cryptocurrency services.

Reputation goes a long way and usually is hard-won and well deserved. Binance, Coinbase, Kraken, KuCoin, have a large customer base and huge trade volumes, not only because they are established in the market, tried and tested, but also because they’ve earned trust by providing a very essential service, which in the field of crypto is – safety.

Their verification and security protocols, while not unbreachable, are solid to protect clients and their funds.

If you need a quick check to see if your cryptocurrency service platform is a scam or not, you can turn at ScammerWatch and see what’s estimated rating of that new provider promising sky-high returns…

How To Identify Scammers

Much like cheap knock-offs can be spotted by their bad spelling, outright fake cryptocurrency platforms pretend they are someone else.

Imposter websites will steal the look of reputable services, resembling the originals. Common tactics include substituting zero for the letter “o”, using a typo version of the name (Binance, Coinbase, etc), or even stealing the name and parking it at the wrong extension (, instead of

Trading bots that are in fact scams will often have several domains and several different logos. Oftentimes, however, you will be able to find informative pages of the like of this cryptosoft bot review that will be able to help gauge whether you are confronting a scam.

Similar scams are pulled on mobile app platforms, though Android users seem to be hit more often than iOS apps. Fake apps either sport knock-off logos and thumbnails, or fake misspelled names.

Just like celebrities on social media have many impostor bots, fakes, and ‘official’ accounts, the same is with cryptocurrencies and various popular services.

Especially are NOT to be trusted those crypto-projects that aggressively share quotes and ‘endorsements’ by crypto-celebs.

Many fake or fraudulent crypto platforms will try to advertise their services by dropping clips of Elon Musk, Jack Dorsey, Mark Cuban, or Richard Branson.

Scammers even used the reputation and respectability of Sweden, promoting fake e-Krone coins. Even the fame of Squid Games was used in a brutal rug-pull scam, escaping with millions and ruining investment of thousands of uses.

Other red flags are pushy notifications, aggressive emails or even phone calls, asking for more investments, topping up accounts, and locking up deposited funds for extensive periods.

While it’s not easy to discern scammers from crazy investments offering thousands of percent APY which are not illegal, just insanely risky, it always pays off to do the research.


If a project has no social media, support, email, or contact address, that’s the first red flag right there. Check for the white paper. Crypto projects will present a document to promote or highlight the features of a solution or platform.

When white paper documents read more like advertisements, and less like explanations of use cases, that’s another red flag.

Incredibly short white papers which deal in promises instead of proposing a new solution, details of an ecosystem, it’s time to become very suspicious. While many projects will have anonymous teams, those who openly showcase their owners, chief officers, and dev teams will appear less suspicious.

If it’s too good to be true, it definitely is. This old adage is not always true in the crazy world of cryptocurrencies, but it is a good rule to live by and navigate the murky waters of decentralized finances.

Michael Klias

Crypto enthusiast with 7 years of professional experience. I am passionate about blockchain, finance and technology.

I have been working in different organizations from small start-ups to big corporations in the UK and overseas. My focus has always been on improvement processes of investing and trading, cryptocurrency, ETFs, and alternative investments.

Previously was a reporter with Wilmington Business Journal and business producer for HelathCoin LLC in Hong Kong.

Straight talk business crypto executive with strong personal engagement, assertiveness and high energy.