Scammers love to catch people in a hurry or new investors. Fake crypto exchanges are an easy way for scammers to steal funds. Here is a quick guide on how to spot these exchanges.
It's in the URL
Always check the domain name and URL of the exchange. Fake crypto exchanges use similar names or logos to well-known exchanges, but there are usually slight differences.
They might use coinbaise.com instead of coinbase.com. In some cases, the URL won't end in a .com at all. Instead, it would be a .io, .net, or .org.
Be sure to check the security features of the policies of the exchange. Scam sites use weak encryption, have no multi-factor authentication, or lack cold storage.
Their terms and conditions are often vague and require a lot more personal information.
Make sure the site begins with HTTPS:// and not HTTP://. Exchanges that have a URL that starts with HTTP:// are more likely to be scam sites.
Is It Worth It?
Check if the exchange is highly recommended. Do the crypto experts recommend it? Fake exchanges have hardly any online presence.
For KYC exchanges, verify if the exchange is registered or licensed by the SEC.
Fake crypto exchanges use incentives to lure investors. Look at the offers and promotions of the exchange.
Are they too good to be true? Be cautious of exchanges that promise low fees, high returns, or free bonuses.
Usually, these perks come with a catch. They require a large deposit of crypto, a certain amount of transactions, or inviting others to the site.
How to Protect Yourself
Online resources like CoinMarketCap list information on all types of exchanges, including features and ratings.
Try to use the most reputable exchanges you can.
Use a strong and secure wallet that is compatible with the exchange. Before trading large amounts, use a small amount of funds for testing.
Once you're done trading, get the funds off the exchange ASAP.
Avoid any suspicious links or attachments. If you see any "account compromised" emails, it's best to log in to a separate tab and verify for yourself.
Wrapping Up
The URL is always the key to identifying scam exchanges. Check for misspellings and domain extensions.
Verify the exchange is legit by checking reviews and features. If the perks are too good to be true, they probably are.
When trading crypto, practice safe cybersecurity. It's a good idea to trade like any exchange could be breached at any time.
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