RISKS &
SCAMS
Crypto can be life-changing — but so can losing it all. Know the risks before you invest a single dollar.
📉 Market Risk & Volatility
Crypto markets are extremely volatile. Bitcoin has dropped 80%+ multiple times in its history. Altcoins can lose 95%+ of their value. This volatility is both the opportunity and the danger.
BITCOIN VOLATILITY
ALTCOINS (TOP 20)
STABLECOINS
🚨 Common Scams — Learn to Spot Them
| Scam Type | How It Works | Red Flags |
|---|---|---|
| Rug Pull | Devs launch a token, hype it up, then drain the liquidity pool and disappear | Anonymous team No audit |
| Ponzi Scheme | Pays early investors with money from new investors until it collapses | Guaranteed returns |
| Phishing | Fake websites or emails that steal your seed phrase or login credentials | Typo domains |
| Pump & Dump | Coordinated buying to inflate a coin's price, then dumping it on retail buyers | Sudden hype |
| Fake Giveaways | "Send 1 ETH, get 2 back" — always a scam. No legitimate person gives away crypto. | Celebrity impersonation |
| Honeypot | Token lets you buy but not sell — you're trapped once you invest | Can't sell token |
⚖️ Regulatory Risk
Crypto regulations are still evolving worldwide. Governments can ban exchanges, restrict trading, or impose heavy taxes. China has banned crypto multiple times. The US SEC has been aggressive with enforcement actions against exchanges.
Always be aware of the regulatory environment in your jurisdiction and ensure you're using compliant platforms.
🔒 Self-Custody Risk
While holding your own keys gives you full control, losing access means losing everything permanently. There's no "forgot password" on the blockchain.
Have multiple secure backups of your seed phrase. Consider a metal backup plate that won't burn or flood. Tell a trusted person how to access funds in an emergency.