What Is a Honeypot Crypto Scam?

Adekunle Joshua

The crypto ecosystem is innovative but plagued with hacks and attacks

One common type is the honeypot scam. The charade begins with extensive marketing and celebrity endorsements, creating a buzz around the platform

Celebrities and social media adverts fuel the hype, with lofty price projections attracting investors

The token value skyrockets, reaching all-time highs. Excitement ensues as investors think they've made great profits

But when they try to convert tokens to fiat or other cryptocurrencies, they encounter a surprise

An error message prevents them from trading the token. They discover that the developers wrote code to disallow selling, leaving them stranded

Squid Game token serves as an example. Capitalizing on the TV series' popularity, the scam duped investors. Believing it was related to the show, they bought the tokens

Only later did they realize they couldn't sell, while the developers vanished with millions in BNB

Honeypot scams exploit the trust of investors, relying on hype and attention to deceive

The allure of quick profits leads many into their traps. Caution and thorough research are vital when investing in the crypto market

Look for transparency, a solid team, and a clear roadmap. Avoid projects that restrict token selling exclusively to developers.