The cryptocurrency industry started 2025 with a bang thanks to record high values, legislative changes, and unprecedented interest. Some of the big winners from this increase in popularity have been established options like Bitcoin and Ethereum. Still, it has also sparked interest in emerging projects with consumers desperate to invest in the next big thing.
There are lots of great opportunities available to consumers with existing cryptocurrencies and exciting crypto presale options emerging. Because of this, users are making the most of high-quality crypto wallets that can store multiple cryptocurrencies and give users easy access to vital stats to help them manage their portfolios.
However, as with any investment opportunity, scammers can attempt to target consumers. As the techniques that cybercriminals use get ever more sophisticated, it is more important than ever before for consumers to be aware of scams and the best ways to avoid them.
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Research the Project
Occasionally you might feel the need to act quickly to make the most of an opportunity, but taking some time to research the project will give you a better understanding of its potential, and minimise the risk of being scammed.
Researching a project will reveal the developer’s goal and mission as well as the token’s use case. A genuine new crypto project should provide potential investors with a clear roadmap and have practical use cases, those that fail to provide this could be worth avoiding.
Research the Team
The validity of a crypto project can often be determined by who is involved. Scammers are unlikely to use their real identities, so researching the teams behind a new crypto launch and looking at their history will help you find those being carried out by people with experience in the industry.
Examine the Whitepaper
A project’s whitepaper provides all the key information a potential investor should need and will typically be found on their website. Consumers will be able to check the timelines for the project’s goals and it should be clear and straightforward.
Poorly written whitepapers with spelling mistakes, plagiarised material, grammatical errors, and poor designs are a good sign that this project should be avoided.
Check for Projects on Prominent Exchanges
The top exchanges typically have strict requirements for new listings and projects are thoroughly reviewed before being allowed. While doing your own research is essential, this can be a great way to find listings that have been assessed by experts.
Inspect the Liquidity of the Token
Being able to convert crypto to cash without having an impact on its market price is referred to as token liquidity. While a buyer might not think what happens to the value of crypto after they sell it should impact them, it could make it difficult to move on.
Crypto projects with poor liquidity do not represent good investment opportunities.
Follow Social Media Marketing and Activity
The social presence of a new crypto project will give a good idea of its popularity. However, it can also be used to create a false narrative, so taking a look at how it markets the project is important.
Scams will be money-centric rather than providing details about the vision and tech being used.
Checking for interactions can also help to identify accounts with fake followers that have been bought to boost numbers. For example, a new crypto project with a core of 1,000 active followers should be a more appealing aspect than one with hundreds of thousands with barely any interest in posts.
Identify Price Patterns
Irregular trading patterns and price spikes tend to identify scams. Sudden or extreme volatility in crypto prices can result in investors losing money overnight. Although volatility has been one of the specifics of cryptocurrencies, there’s a fine line between natural price changes and pump-and-dump schemes, tailored to benefit the well-off owners of coins. Therefore, make sure to identify the price patterns of the existing coins to gather enough knowledge applicable to new iterations.
Analyze the Project’s Tokenomics
The tokenomics of cryptocurrencies describes the economics of the token and provides clarity over such key factors as distribution, utility, and token supply.
Something for investors to avoid is crypto opportunities where the team holds most of the token supply. This puts the value at risk if they decide to sell. Most recently we saw this happen with the viral HAWKTUAH coin where investors lost fortunes after the price tanked.
Invest in Software to Provide Key Information About Projects
Carrying out your due diligence on crypto projects should help you identify those that should be avoided, but it is not always easy to get all the information you need quickly.
Thankfully there are tools on the market to help, including those designed to monitor real-time crypto activities that can alert you to security threats and other activity that could be cause for concern.
Some of these tools provide detailed data on liquidity, holders, the contract source, and where it can be traded.
Receiving real-time data on trading volume, token price, and market cap makes it easier for investors to manage their portfolios. Being able to scan information on project’s websites, whitepapers, blockchain, and audits is a great option for those serious about crypto.
Be Wary of Being Targeted Via Social Media
While social media can be a valuable tool for finding crypto projects and getting valuable information, it can also be used by scammers to target consumers.
Many phishing scams use phone numbers or emails to target consumers, but social media allows them to find out more about the person and provide live contact.
These scams can take months to gain the trust of consumers and can often provide opportunities that begin on a small scale. As trust grows and alleged returns continue to come in, scammers can then encourage users to invest more.
Quite often these attempts will also use websites that are designed to look real and show consumers what they want to see. Scammers can also begin coaching consumers on the best techniques to avoid security from banks, and this is another sign that things might not be legitimate.
Keep an Eye Out for Unrealistic Targets
Everyone is hopeful of high returns from crypto investments, but projects that promise unrealistic returns will typically be too good to be true. Again, detecting price patterns of some existing crypto coins since their launch is a clever way of developing the skill of recognizing unrealistic targets. Also, learning more about the team behind the new coin you’re thinking about investing in will help you make up your mind. If you spot the people who have already been involved in scams, you won’t invest in that coin. It works the other way around: successful crypto developers and investors who have already launched profitable coins are highly likely to repeat the pattern.
