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What is a Honeypot in Crypto

What is a Honeypot in Crypto?

  •  June 1, 2023  •     


A honeypot in crypto refers to a meme coin or token that can only be bought, and not sold. As a result of this the price only goes up, while the developers attempt to capture the buyers coins and run away with the loot.

Here is a recent example of a honeypot scam coin that launched just 1 hour before the writing of this post.

$CHINADONG

Honeypot Crypto Example - $CHINADONG

As you can see by the chart, the price rise is aggressive and looks as if it will go to the moon.

Unfortunately, this type of scam still fools many people, and bots. Take a look at the transactions, and you will see traders still put large sums of crypto into this kind of coin. (An indication, of how little due diligence some traders undertake before buying a token.)

Honeypot Trading Volume

How to Avoid a Honeypot in Crypto?

The easiest way to avoid getting trapped in a honeypot is to check for red flags in the Go+ Security tab on the right hand side in dexscreener.

Honeypot Warning Dexscreener

As you can see, there are 3 red warnings there. When you click the reveal icon, you can plainly see at the top that the Honeypot test indicates a Yes.

Because any smart contract can be analyzed, it is possible for dexscreener to tell if there is a problem with not allowing holders to sell the token.

So that is the easiest way to avoid a Honeypot… Simply do some basic checks on dexscreener to ensure that the token is not flagged as a honeypot.



Max K. Montague, Meme Coin Trader
  A Crypto Trader, Miner and Investor with 11+ years experience trading stocks, forex, crypto and meme coins. My hobbies are helping others make money online as fast as possible while managing risk tolerance.

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