Deceptive Tactics: How New Crypto Exchanges scam Users

The decentralized nature of cryptocurrencies has led to the meteoric rise of numerous crypto exchanges. While many platforms strive for transparency and user-friendliness, there’s a growing concern about the malpractices of some newly created exchanges.

Unscrupulous operators exploit the decentralized and unregulated nature of the crypto sphere, devising tactics to deceive unsuspecting users. In this deep dive, we’ll shed light on these deceptive tactics and provide guidelines for safe crypto trading.

The Lure of Non-Existent Offers

Many emerging exchanges attract users with irresistible offers, promising unprecedented returns on investments. They showcase exaggerated trading volumes to create a facade of credibility and activity.

However, these volumes are often fake, created using trading bots that perform wash trading – buying and selling their own orders to give the illusion of high market activity.

Hidden Fees and Unfair Rates

Transparent fee structures are a hallmark of reputable exchanges. Conversely, dishonest platforms often have hidden charges or adjust currency conversion rates in their favor, causing unsuspecting traders to pay more than expected.

These platforms may also charge exorbitant withdrawal fees, making it expensive for users to move their funds out of the exchange.

Misleading User Interface (UI) Designs

The User Interface (UI) plays a pivotal role in user experience. Dishonest exchanges often manipulate their UI, making it confusing for users to understand the actual transaction costs, trading pairs, or even their own account balances.

This deceptive design can lead users to make erroneous transactions or prevent them from realizing that they’re being charged more than what’s fair.

Exit Scams: The Ultimate Betrayal

Perhaps the most alarming tactic is the exit scam. After gaining the trust of a sizable user base and accumulating deposits, these exchanges suddenly go offline. They disappear with users’ funds, leaving behind a trail of distraught investors and shattered trust.

Protecting Yourself in the Crypto Realm

Stay vigilant. Always research an exchange’s reputation, look for red flags like unrealistic promises, and be wary of platforms that lack transparency. Prioritize exchanges with established track records and avoid entrusting large sums to platforms without credible reviews or history.

Remember, while the crypto world offers vast opportunities, it’s essential to tread with caution and arm yourself with knowledge.