Lesson 4 - Fake Exchanges & Withdrawal Traps

How it works: Centralized exchanges are custodians—they hold your assets and update a dashboard while you trade inside their system. On a legitimate exchange, deposits credit quickly and withdrawals work after standard checks (KYC, limits, fees you can see upfront). A fake or predatory exchange copies the look of a real one or invents a new brand, encourages you to deposit, simulates profits on the screen, then blocks cash-outs with shifting reasons: “upgrade KYC,” “pay a release fee/tax,” “add more funds to unlock.” Some sites are full clones at typo-domains or ads placed above the real result. Others are new names with affiliate hype and no history. The trick isn’t making you trade—it’s making you chase your own money with more money.

Spot it

• New/unknown domain hyped by affiliates; support that reaches out to you first.
• Withdrawals require extra deposits or invented fees ("unlock", "tax").
• Static deposit addresses, no per-user tags; terms change after you deposit.

What to do

• Start only from the exchange’s official site (bookmark it) and test with a tiny deposit + tiny withdrawal before adding funds.
• If blocked once, stop funding, capture evidence (TX hashes, chats, URLs), and warn others.

How It Plays Out

You search “zero-fee crypto exchange” and tap the top result without noticing the tiny Ad label. The site looks polished—dark theme, clean charts, a “proof of reserves” badge that links to a PDF hosted on their own domain. Signup is instant; the welcome bonus countdown starts at 59:59.

Deposits credit fast. Inside, everything feels normal: prices match elsewhere, your balance ticks up after a few quick trades. You go to withdraw a small amount to your wallet. A red banner slides down: “Account Tier: Basic. Upgrade to Platinum to withdraw today.” The upgrade requires a fee you must prepay on-chain. Support replies quickly—too quickly—with a canned line: “This is standard anti-fraud policy. After upgrade, funds release immediately.”

You try another route: withdraw a smaller amount. Now the message says the network is congested, but if you deposit 0.1 more to reach a “safe liquidity threshold,” withdrawals unlock in one transaction. That’s the tell. Real exchanges deduct fees from your balance or refuse the request; they do not ask you to send more to get back what’s already yours.

The escape is simple, if less exciting than the bonus banner. Begin with a tiny deposit and attempt a withdrawal before you ever size up. Bookmark the official domain and only use that path. If a site invents a pre-withdrawal fee, changes terms after the fact, or needs you to add funds to “unlock,” step away. Take screenshots, save links, and file reports; someone else is standing where you stood five minutes ago.

Pocket anchors: Real platforms don’t need extra deposits to release your money. Test withdrawals first. Bookmarks over search ads. If rules change after you deposit, they’re not rules—they’re a net.