How to spot a crypto scam
If you’re investing in crypto, watch out for these potential red flags.
Unexpected Contact
Be cautious if someone you don’t know reaches out with investment advice or opportunities. This could happen:
- through a phone call, email, social media message, or text
- from someone claiming to be an investment manager or broker
- in an online forum or discussion group, especially those related to crypto
You might come across these schemes through people or sources that seem trustworthy, such as:
- a social media advertisement or a fake celebrity endorsement
- an online influencer promoting a token and boasting about fast, significant profits
- friends or family members who may have been unknowingly scammed and are passing along the recommendation
- an online romantic partner or acquaintance who asks for money in crypto or suggests an “investment opportunity”
Pressure to Take Action
Scammers often try to create a sense of urgency and may pressure you to:
- move your crypto off your existing exchange and invest through their platform
- use cryptocurrency to pay an individual or for a financial service
- download an investment app that isn’t available on the Google Play Store or Apple App Store
- deposit money into various bank accounts as part of an “investment”
- pay supposed taxes or add more funds before you can access your money
Something Doesn’t Feel Right
You may sense warning signs when:
- a crypto investment promises “guaranteed” high returns or offers “free” money
- a crypto service provider withholds your earnings under the pretext of “tax purposes”
- unfamiliar or suspicious tokens suddenly appear in your digital wallet
- there is little to no documentation or transaction history for the crypto investments you make
- the investment document (often called a whitepaper) is vague, poorly written, or missing
- online searches show negative reviews or suggest the entity might be a scam
- a work-from-home job requires you to buy or trade crypto as part of the role
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