Why fake tokens exist
On a centralized exchange, every listed token goes through a vetting process. On a DEX, anyone can create a token and add a liquidity pool for it. The barrier to entry is near zero — which means scammers can spin up a fake token in minutes.
Common tricks include cloning the name and logo of popular tokens, airdropping tokens to thousands of wallets, and creating honeypots where you can buy but can't sell.
Red flags to check
1. Verify the contract address
Never trust search results or random links. Go to the project's official website or CoinGecko/CoinMarketCap page and copy the contract address from there. Compare it character by character with what you see on the DEX.
2. Check holder distribution
On Etherscan, look at the "Holders" tab. If one wallet holds 50%+ of the supply (excluding known contracts like liquidity pools), that's a massive red flag. They can dump the entire position at any time.
3. Is liquidity locked?
Check if the liquidity pool tokens are locked in a timelock contract. If the creator can remove liquidity at any time, they can rug pull. Tools like DEXScreener and GoPlusLabs show liquidity lock status.
4. Check the contract code
Is the contract verified on Etherscan? Unverified contracts hide their source code — you can't see what the code actually does. Some honeypot contracts include hidden transfer taxes, blacklist functions, or mint functions that let the creator create unlimited tokens.
5. Look at trading activity
Real tokens have organic trading patterns. Fake tokens often show artificial volume — the same wallets trading back and forth to simulate activity. On DEXScreener, check if there are many unique wallets or just a handful trading repeatedly.
6. Airdropped tokens you didn't buy
If tokens appear in your wallet that you never purchased, do not interact with them. Don't try to sell, approve, or transfer them. Many are designed to steal your funds when you attempt to interact. Just ignore them.
Tools that help
- Token Sniffer (tokensniffer.com) — automated scam detection for Ethereum tokens
- GoPlusLabs (gopluslabs.io) — security API that checks for honeypots, high taxes, and more
- DEXScreener — shows trading patterns, liquidity depth, and holder data
- RugDoc — community-reviewed database of DeFi project risk assessments
The safe starting point
On Korvex, every trading pair uses verified, established cryptocurrencies with real market data. There are no fake tokens, no rug pulls, no scam contracts. It's the safe environment where you learn to trade before entering the wilder parts of crypto.