How to Avoid P2P Crypto Scams and Fraud
Buying and selling cryptocurrency on peer-to-peer (P2P) platforms is growing increasingly popular — thanks to the absence of intermediary parties and the general flexibility of this trading mode. Additionally, established P2P crypto trading environments, such as Bybit’s P2P Trading platform, provide robust escrow systems and dispute resolution mechanisms. However, P2P crypto trading, just as any other kind of P2P financial activity, comes with a wide variety of scams and fraudulent schemes that every trader needs to be aware of before buying or selling cryptocurrency.
In this article, we’ll take a look at common P2P crypto scams and learn how to avoid them.
Key Takeaways:
P2P crypto scams involve various strategies to defraud honest traders. These exploits may include fake payment proofs, chargebacks, phishing exploits, impersonation, triangle scams, SMS scams and more.
The key methods to avoid falling victim to P2P crypto scams include always using on-platform communication and payment channels, checking your account to verify payment information, carefully tracking the parties you receive funds from and make payments to, never releasing funds without receiving your payment and avoiding “better deal” offers via external channels, among others.
What Is a P2P Scam in Crypto?
P2P scams in crypto trading include diverse fraudulent techniques and schemes that nefarious individuals or groups employ to part honest traders with their hard-earned funds. These schemes exploit the unique nature of P2P crypto trading on online marketplaces and platforms.
Typically, a crypto P2P scam involves various elements, such as producing fake payment documentation, impersonating someone trustworthy or running an elaborate scheme that confuses the unsuspecting victim and forces them to release funds to scammers. Urging the victim to take transactions off a legitimate platform, and even the use of psychological pressure tactics, are frequently involved.
How Are Crypto P2P Scams Different?
While any type of P2P financial activity may involve scams, certain unique characteristics of crypto P2P trading make this area particularly attractive to scammers and fraudsters of all kinds. First, crypto trading platforms feature a lower degree of regulation than many other markets, particularly the stock market. Secondly, it's common for scammers to urge their victims to take all communication and payment activity off-platform. Left one-on-one with scammers, victims have little recourse when they lose their funds.
Moreover, the barriers to entry within crypto trading are relatively low, attracting a large number of financially naive or inexperienced individuals, many of whom fall victim to the various scams running in this sphere.
Examples of P2P Scams in Crypto
Below, we’ll cover some of the most common scams involved in P2P cryptocurrency trading, and discuss the best ways to avoid them.
Fake Receipt Scams/Escrow Transaction Scams
In fake receipt scams, the scammer sends forged payment documentation to trick you into releasing your crypto without actually sending any funds. In escrow transaction scams, the scammer urges you to use a fraudulent escrow service. You’re tricked into releasing payment into the escrow fund, assuming its legitimate nature.
How to avoid fake receipt scams/escrow transaction scams: In order to avoid fake receipt scams, always verify that you’ve received the actual payment directly in your bank account or wallet before releasing funds from your side of the transaction. Additionally, never trust screenshots.
As for fake escrow scams, only use trusted escrow services from reputable P2P platforms — and never send funds outside the official system.
Chargeback/Check Scams
In chargeback scams, the fraudulent counterparty makes a payment and then files a chargeback after receiving funds from you, claiming fraud or an unauthorized transaction. As a result, the bank reverses the payment, and you find yourself out of both your money and crypto.
Scammers also like to exploit the vulnerability of check transactions by urging you to accept this form of payment. The check used to pay you bounces, leaving you unable to cash the now worthless piece of paper.
How to avoid chargeback/check scams: Always ensure that you’ve received the payment in your account and the funds are available to you — i.e., there are no provisional lockups or pending confirmations — before releasing the payment on your side.
Also, avoid accepting check payments. Check transactions are particularly vulnerable to scams — and in 2025, there’s no pressing need to use this rather antiquated form of payment.
Cancel Order Scams
In this type of scam, the fraudster tricks you into canceling the order after you've already sent the funds. They typically tell you that there's a technical problem with payments or a price mistake, advising you to cancel and reorder. If you cancel, the platform views the trade as void. Meanwhile, the scammer disappears with your funds — and removes any ads they've placed on the platform.
How to avoid cancel order scams: The key to preventing cancel order scams is simple: never cancel after you've paid, no matter what excuse the counterparty comes up with. If there's a genuine issue on their part, advise them to use the support system provided by the particular P2P trading platform.
Overpayment Scams
In an overpayment scam, the scammer sends a higher amount than what was agreed upon during the deal. They then ask you to refund the excess amount, claiming it was a mistake on their part. Once you send the refund for the difference, the original payment is reversed as incorrect or fraudulent.
How to avoid overpayment scams: To avoid overpayment scams, be cautious when you receive an offer with a mismatch between your asking price and what you’re being promised. If you're unsure about the situation, simply refuse the transaction, or ask the buyer to redo the transaction with the correct amount.
Phishing Scams
Phishing scams involve nefarious parties pretending to be legitimate platforms or individuals in order to trick you into giving away your private keys or login details. Often, they’ll send you fake emails and messages, or even create fake web pages that resemble real ones. Your login credentials might be compromised if you visit such a page via your browser and respond to the requests to share your details.
How to avoid phishing scams: Never click on links from unknown sources. Verify URLs to ensure you're on the actual site, and never share your private keys or personal information with anyone, even if they sound trustworthy. Additionally, ensure that you protect your account with strong passwords and security features, such as two-factor authentication (2FA). Also, note that reputable websites virtually never offer a non-encrypted connection (the one that begins with http, rather than the more secure https).
Note: Legitimate P2P trading platforms such as Bybit P2P will never send you emails or messages asking for your login information.
Impersonators
Impersonator scams involve scammers pretending to be representatives of legitimate P2P platforms. They might also pose as well-known, trusted traders. These parties misrepresent their identities, and typically urge you to take the transaction outside the platform under various pretexts. If you fall for these scams and move your transactions outside the legitimate platform's environment, you lose all protections, and the scammers can easily steal your funds.
How to avoid impersonator scams: Always stay within the platform for transactions. If anyone claiming to be from the platform asks you to move the trade off-site, report it immediately.
SMS Scams
SMS scams involve fraudulent parties sending fake messages to your mobile phone that look like they're from your bank or a payment processor. The message typically states that you've received a payment, specifying the amount you expect to receive from your transaction. The goal might be to steal your sensitive login details (if you click on the message), or to get you to send crypto or money to the fraudulent trader you’re dealing with.
How to avoid SMS scams: Don't click on links in unsolicited SMS messages. Always double-check by logging into your bank or trading account directly through the official website or app.
In-Person Cash Transactions
In-person cash transactions, while allowed on many P2P crypto trading platforms, are an area of particular risk, due to the difficulties in proving or tracking any payments made. Scams during these transactions may involve a scammer buying or selling crypto with cash during a face-to-face meeting. In the buying scenario, the scammer might pay with fake bills. In the selling scenario, they may falsely claim that you’ve paid with counterfeit cash after receiving their crypto funds.
How to avoid in-person cash transaction scams: In general, try to limit cash-based trading as much as feasible — cash transactions are notoriously hard to verify in cases of disputes. If you absolutely need to buy or sell crypto for cash, carefully examine the counterparty’s reputation and history on the trading platform.
Triangle Scams
Triangle scams involve two scammers working together to deceive a seller. Here’s how it works: Scammer A and Scammer B both place orders with the same seller. Let's say Scammer A's order is for 1,000 USDT, and Scammer B's order is for 1,500 USDT. Scammer B sends a payment for 1,000 USDT, and Scammer A then marks their order as "paid." The seller releases crypto to Scammer A, seeing that their order has been marked as paid and that the seller's account was credited with 1,000 USDT.
Scammer B then sends a second payment — 500 USDT, the remaining amount on their buy order — and pressures the seller to release their funds, producing payment proofs for both transfers.
How to avoid triangle scams: Always verify that the payer’s name matches the identity verification info on the platform. Be careful with payment proofs produced, as scammers might also try to reuse the same ones for multiple orders. Always double-check before releasing crypto in order to ensure you're dealing with the right person — and not falling for a scam.
Man-in-the-Middle (MITM) Scams
In this type of scam, the fraudulent party offers you a better rate through an external communication source like Telegram or WhatsApp. They ask you to create an order on a legitimate platform after they've supposedly paid you with the better rate externally. However, the payment never arrives, and is only supported by fake proofs.
How to avoid MITM scams: Don’t communicate with potential parties on external channels, and don’t pay them outside of the P2P platform you use. Always use the communication channels offered by an established trading platform. Additionally, never release payments before having received your funds — advice that applies not only to MITM scams, but also to many of the other exploits we've discussed above.
How to Spot P2P Crypto Fraud
Below are some common key red flags that may help you spot a P2P crypto scam:
Attempts to take communication off-platform
Unusually good offers, especially if you’re willing to transact off-platform
Various pressure tactics to create urgency
Payment proofs not accompanied by actual funds
Third-party payments
Sudden changes in the deal or amounts agreed upon
How to Avoid Crypto P2P Scams
To avoid falling victim to P2P crypto scams, you can take a few common sense steps and stick with your approach — regardless of what the counterparty suggests.
First of all, never take communication or payment activity off-platform.
Don't trust poorly known third-party escrow or trading services.
Limit your dealings with less secure payment methods, such as cash and checks.
You’re also advised never to trust screenshots of proof of payment. Always check that you've received actual payment before releasing any funds.
Finally, never send payments to third parties — always pay to the counterparty’s account registered on the platform. Finally, and most importantly, don’t succumb to pressure tactics, urgency pleas or intimidation tactics.
What to Do If You’ve Been Scammed
If you've fallen victim to a P2P crypto scam, immediately report the issue to the platform, freeze your account activity to avoid unauthorized payments out of it, contact your bank or payment processor to inform them of the issue, collect documentary evidence — and, if the problem warrants it, report it to your local authorities.
The Bottom Line
Trading crypto via P2P channels can be a highly profitable and rewarding activity. While some of the above scams sound frightening, doing your due diligence and sticking with the common-sense approaches and strategies we’ve outlined above should minimize your risk of falling victim to the sinister pursuits of crypto scammers.
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