Memecoins promise life-changing gains, but scammers have turned this space into a minefield. Three terms you’ll hear constantly—rugpulls, honeypots, and farming—are often misunderstood, yet they’re responsible for 99% of losses in low MC tokens. Here is How To Identify MemeCoin Scams! Let’s break down how they work, how to detect them, and why you must check these red flags before buying.
New Coin Scams That Drain Your Wallet (and How to Spot Them)
1. Rugpull: The Coordinated Dev Dump
What Happens:
- Developers (or bots) hold a large chunk of the token supply (often via multiple wallets disguised to look like separate holders).
- They wait until the price pumps (e.g., from hype or volume bots), then sell all tokens at once, crashing the price to near zero.
How to Spot:
- Bubblemaps/DexScreener: Check if 20+ wallets hold the exact same percentage of tokens (e.g., 1.5% each). This suggests one entity splitting supply to hide.
- Holder Clusters: Look for wallets that bought at launch and never sold—these are devs waiting to rug.
- Example: A memecoin where 30% of supply is split across 60 wallets, all inactive until a coordinated dump.
Real-World Case: Squid Game Token (2021) – Devs held 90% of supply, dumped after viral hype.
2. Honeypot: The Trap You Can’t Escape
What Happens:
- The token’s contract is coded to prevent selling. You see massive gains in your wallet, but you can’t cash out.
- When you try to sell, you either get an error or receive pennies due to price impact (e.g., a 99% tax on sells).
How to Spot:
- RugCheck.xyz: Audit the contract for functions like
blacklistorantiWhalethat block transactions. - Test Sells: Before investing big, try selling a tiny amount. If it fails, it’s a honeypot.
- Liquidity Check: No locked liquidity? The dev can pull all funds instantly.
Real-World Case: Most anonymous BSC tokens with names like “ElonMoonX” use this trick.
3. Farming: The Slow Bleed Scam
What Happens:
- A scammer “farms” the token by:
- Sniping a large portion at launch (via bots).
- Distributing tokens to dozens of wallets.
- Dumping repeatedly at key price levels to drain liquidity, preventing the coin from rising.
- The coin never pumps sustainably—it’s designed to churn small profits for the scammer until it dies.
How to Spot:
- Unexplained Sell-Offs: Sudden sells from wallets that never bought the token (tokens were airdropped).
- MC Ceiling: The coin struggles to break past a certain MC (e.g., $50k) despite volume.
- Transaction History: Use DexTools’ LP Analysis to spot airdrops to suspicious wallets.
Real-World Case: Many Solana memecoins with “stealth launches” are farmed this way.
How to Protect Yourself
- Always Check:
- Liquidity Locks: If liquidity isn’t burned or locked, assume it’s a scam.
- Contract Audits: Run tokens through RugCheck.xyz or Honeypot.is.
- Token Scanners: Use
t.me/memecoin_helpscanners to scan contract addresses.
- Avoid:
- Tokens with >4% supply in similar-sized wallets.
Key Takeaways
- Rugpull = Hidden dev dumps.
- Honeypot = You can’t sell.
- Farming = Slow, repetitive draining.
- Your Best Defense: Scanners + Telegram Groups.
Join t.me/memecoin_help for free token scanners, real-time alerts, and survivor stories. Memecoins are risky—never invest more than you can lose.
CTA: Think you found a gem? Scan it first with our free tools at MemeCoin.help.