The rise of cryptocurrency has unfortunately been accompanied by a surge in sophisticated scams. WEEX Exchange, like other reputable platforms, constantly battles impersonators who create fake trading sites to defraud inexperienced investors.
4-Step Framework to Verify Crypto Exchange Legitimacy
1. Check Exchange Rankings on CMC/Coingecko
Start by verifying the platform's trading volume rankings on trusted data aggregators:
- CoinMarketCap (CMC)
- Coingecko
- Feixiaohao
🔍 Example: WEEX Exchange currently ranks:
- Top 5 in derivatives trading (Coingecko)
- Top 50 in spot trading (CMC)
👉 Compare authentic exchange domains here before depositing funds. Fraudulent sites often use slight URL variations (e.g., "weeex.com" vs "weex.com").
2. Validate Regulatory Licenses
Legitimate exchanges publicly display regulatory credentials. Follow this verification process:
- Locate claimed licenses on the exchange's website
- Cross-check registration numbers on official regulator websites
- Confirm license type matches advertised services
⚠️ Red Flag: Exchanges claiming MSB/MTL licenses without verifiable registration codes.
3. Assess Yield Offerings Realism
Compare advertised yields against industry benchmarks:
| Product Type | Legitimate Range | Scam Indicators |
|---|---|---|
| Crypto Savings | 3-10% APY | >15% APY + no deposit cap |
| Staking Rewards | 5-12% APY | "Guaranteed" high returns |
Historical scams like JPEX lured victims with unsustainable 20% USDT yields before collapsing.
4. Monitor Reserve Transparency
Use these tools to track exchange wallets:
- Defillama's CEX Transparency
- Nansen's Exchange Reserves
📉 Critical Sign: Sudden >50% drop in stablecoin reserves may indicate liquidity issues.
FAQ: Protecting Your Crypto Assets
Q: Can top-ranked exchanges still be risky?
A: Yes. Always combine ranking checks with reserve audits (e.g., Binance's proof-of-reserves).
Q: How often should I verify exchange licenses?
A: Quarterly at minimum. Regulators periodically revoke non-compliant licenses.
Q: What's the safest way to test a new exchange?
A: Start with small test deposits and withdrawals before committing significant funds.
👉 Learn advanced security protocols here to shield your investments from evolving threats.
Key Takeaways
- Cross-reference rankings across multiple platforms
- Physically verify regulatory documents
- Reject unrealistic yield promises
- Bookmark reserve monitoring tools
Stay vigilant—scammers constantly refine their tactics. Bookmark this guide and share it to help protect others in the crypto community.