I just realized what scam really means is a question everyone should thoroughly understand before entering crypto. As the market develops, risks also increase, and scams are becoming more sophisticated.

In fact, scam is a fraudulent act aimed at stealing assets or personal information, with bad actors constantly using clever tricks to manipulate psychology. Although damages from crypto scams in 2023 decreased by 65% compared to the previous year, the total still reaches billions of USD according to Chainalysis.

The most common scam methods I see are phishing—where scammers impersonate emails, websites, or messages from reputable services. Next is pump and dump scams, where developers manipulate token prices, create FOMO, then sell off. OTC scams are also quite common, victims transfer money first and then disappear.

There are also fake apps, wallets, and exchanges. I remember the fake Ledger app on Microsoft Store—quite dangerous. Impersonating accounts on X/Discord also happens frequently, hackers hack accounts and then spread scam links.

There’s also Ponzi schemes—using new investors’ money to pay old investors, collapsing when no new funds come in. Rug pull is when developers suddenly withdraw all liquidity, leaving investors with worthless tokens.

Recognizing scams isn’t too difficult. Promising unrealistically high profits, unclear information, excessive advertising without real products—these are red flags. Projects without security audits, negative community feedback, using domain names similar to major projects, or restricted withdrawal capabilities—all are warnings.

I find the most effective way to prevent scams is to do thorough research before investing. Read the whitepaper, learn about the team, understand the business model. Always check project info on CoinMarketCap, CoinGecko, or scam alert sites like ScamAdviser.

Never share private keys or seed phrases with anyone. Use popular, security-verified wallets. After each DeFi transaction, revoke app permissions. Enable anti-phishing codes and 2FA on exchanges. Diversify your investments across multiple projects instead of putting everything into one.

There are some major scams I know of. Confio used an exit scam—after raising $375,000 at the end of 2017, they suddenly disappeared, and the token dropped from $0.6 to $0.1 in less than 2 hours. Centra scammed $32 million via an ICO, backed by Floyd Mayweather and DJ Khaled, but the two founders were arrested in 2018.

LayerZero was also hacked via Discord, CEO Bryan Pellegrino was targeted, then shared a scam link titled to receive ZRO tokens. BitConnect used a multi-level marketing model, operated for a year, then exit scammed, with the token dropping from $320 to $6 within 24 hours.

Fake websites often use similar URLs, replacing "m" with "n", "0" with "o". They even run Google ads to trick users into visiting. DNS hacks are also complex—redirecting traffic from legitimate sites to scam sites.

The most important thing is to equip yourself with knowledge to protect yourself. Don’t click on suspicious links, don’t download unverified apps. Use tools like Netcraft, SpoofGuard. If in doubt, seek support from the community or experts. Understanding what scam means and how to prevent it is the first step to safeguarding your assets in this market.