How to avoid DeFi scams while trading on dApps

DeFi scams while trading in dApps are currently rising. This is because of the continuous growth and popularity of the sector.

Currently, there is a large number of new projects that have been launched or are been launched. Sadly, in addition to the new project so are DeFi scams increasing in the market.

Customarily the more popular the sector, the more number of scammers attracted to it. As ugly as that may sound this is the case with most all-things finance situations

Your knowledge in the field does not act as a shield that you can’t fall for such a scam, for everyone makes mistakes.

To minimize the chances of your making these mistakes we are going to discuss DeFi scams and how to avoid them in your dApps

Let’s start by what are crypto scams?

Naturally what comes into your head when you think of a crypto scam is a picture of a thief, trying to persuade you to do their bidding

Majorly scammers persuade you to install a program on your device related to crypto.

The program alternates codes retaining the first and last digits of the actual wallet address uninterrupted but changing the middle digits to its creator’s desire. Upon making a transaction you will be confident to have sent it to the correct address. This is without knowledge that the middle digits were altered.

Currently to avoid this, be mindful of the sites you visit and the links you click.

Old tricks reincarnation

Well, what do I mean?

A while ago many social media influencers’ accounts were hacked and random social media stars were offering free cryptocurrency

That is a perfect example. Of late scammers have mastered ways to make you part with your assets.

They will promise doubling services, trading bots with guaranteed profits, risk-free investment models, and many more. Truth be told none of these will be delivered (maybe except trading bots).

To be safe when someone invites you to a “secret exclusive” Telegram group for the best trading signals, do yourself a favor. Block all communications with them

Rug Pulls

This drains all liquidity and subsequently crashing the token price completely to zero

Onc rug pulled the is no turning back for the token it’s over.

How to avoid falling for DeFi scams

In order to avoid falling victim to scams:

• Look at the token allocation and distribution during the project launch
• Take a deep dive into the creators of the token
• Check for the purpose of the token
• Look at the developer’s community and activity
• Check its market cap vs liquidity

Upon confirming all the above then take initiative and decide on whether it’s worth the risk or not.