Three of the Most Common Crypto Scams — and How to Avoid Them

Three of the Most Common Crypto Scams — and How to Avoid Them

Cryptocurrency trading comes with more risk and volatility — and, unfortunately, is often more susceptible to scams. Investors who are vigilant, however, can detect signs of fraud and deceit to ensure they’re engaging in legitimate trades.

Investors should research cryptocurrencies to gain at least a basic understanding of any underlying asset before investing or trading — and never trade tokens they know nothing about.

Here are three common scams and tips on how to avoid them:

Fake ICO and Ponzi scheme

Cryptocurrencies are often launched through initial coin offerings (ICOs). Similar to initial public offerings (IPOs), ICOs allow companies to raise capital to launch a new coin or product. This leaves an opening for scammers to create fake ICOs and devise Ponzi schemes to defraud investors, such as the OneCoin scam.

The ICO process typically involves disclosing information in a whitepaper about the company and the project, including details on finances, duration and the number of digital tokens to be retained. Investors can often buy into an ICO with cryptocurrency, receiving tokens from the company in exchange. Potential investors should carefully inspect whitepapers, particularly the project’s stated objective. It’s also important to verify project team members’ identities and credentials.

At Trust Company, Inc., a New York subsidiary of the GMO Internet Group, a publicly-traded Japanese IT, financial and digital asset conglomerate, we believe information should be fully transparent.

As issuers of the first JPY-pegged stablecoin (GYEN), with the US dollar-pegged stablecoin, USD (ZUSD), we are a fully regulated entity and believe that rigorous government oversight is the best way to protect our users and partners.

For more information on our evolution, security standards and product benefits, visit our whitepaper and monthly attestation reports.

OTC scam

Over-the-counter (OTC) cryptocurrency trades are not conducted on official exchanges but privately between buyers and sellers at the price negotiated by them.

In one of the most common OTC scams, one participant in that exchange agrees to a transaction, then fails to complete it, defrauding the other of money. That could involve, for example, a buyer telling a prospective seller to send digital tokens to a designated wallet address as part of an OTC transaction, then failing to wire the expected fiat in exchange. This kind of scam is most common on social platforms, such as Twitter or Telegram.

To avoid OTC scams, users should trade on regulated exchanges or only with people whose creditworthiness has been verified if trading OTC. They should not trust social media accounts that ask them to send tokens to a specified address.

GMO Trust works with several regulated and reputable exchanges. Visit our website to learn more about how to trade our stablecoins.

Users should be aware that some exchanges might list our tokens without an agreement with us. These exchanges are not listed on our website. In these cases, it’s important to verify the background and trustworthiness of the trading venue.

Phishing scam

With phishing, scammers often publish fake websites that closely resemble those of well-known exchanges to lure users into transferring funds. They might also send fraudulent emails that appear to be from internet service providers, asking for information they can use to hack into cryptocurrency accounts and steal assets.

Users should always examine online information carefully before clicking. Phishing scammers might use logos, names or web domains similar to exchanges or wallet services to gain access to personal information, login credentials or private keys. Users should ensure they are interacting with a legitimate domain or source any time they are asked for login information.

GMO Trust will never send emails asking for account information or private keys. All our emails are sent from @gmo-trust domain and our official website domains are,, and

Like this article? Follow us and Subscribe to stay updated on what’s new.

GMO Trust requires a one-time password and two-factor authentication to maintain account security for clients.

In addition, our official Twitter handle is @GMOTrust, but we will never ask clients to provide information over social media platforms.

To report information about any phishing website or emails involving GMO Trust, please contact us at

GMO Trust engages with regulated partners whose creditworthiness has been verified to ensure GYEN and ZUSD users can trade securely and safely.

To learn more about how to trade seamlessly, settle instantly, and easily transact, visit

More Stories

Want to read more? Check out our blog for more stories.

📰 How Stablecoins Maintain the Price Stability

📰 DeFi Empowerment is Not Going Away — Here’s What to Watch

About Trust Company

Building Financial-Grade Digital Assets. The World’s First Regulated JPY-Pegged Stablecoin Issuer. Visit our website to learn more.

DisclaimerThis content is not financial advice and it is not a recommendation to buy or sell any financial instruments, FX trading, cryptocurrency or engage in any trading or other activities. You must not rely on this content for any financial decisions. Acquiring, trading, and otherwise transacting with financial instruments or cryptocurrency involves significant risks.We strongly advise our readers to conduct their own independent research before engaging in any such activities.GMO Trust does not guarantee or imply that any cryptocurrency or activity described in this content is available or legal in any specific reader’s location. It is the reader’s responsibility to know the applicable laws in their country.



Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store Trust Company Trust Company

Building Financial-Grade Digital Assets. The World’s First Regulated JPY-Pegged Stablecoin Issuer.