Not all crypto projects are created equal, identifying which crypto token is a scam, and which memecoin is legit. How do you know which projects are safe to step into, and which projects are doomed to fall flat some months from now. The blockchain is awash with promises of quick money and easy rides. But it pays to know if the token you’re holding is part of an elaborate scam to separate you from your hard-earned cash. There are eight straightforward ways of carrying out your due diligence to avoid fraudsters

1. Start from the very basics by
a. Check for social media red flag
b.Check for the token’s address in a Google search

2. Check code is verified on Etherscan

3. Check the Etherscan comments section

4. Check the DappRadar blacklists

5. Check the token details in a token explorer
If you cannot find the token on CoinGecko or DappRadar’s Token Ranking (or a similar coin price tracker), the token is probably a scam. If it is on the token explorer and you see warning notifications like this, proceed with caution

6. Check how many exchanges host the token
If the token is only traded on a couple of decentralized exchanges (DEX), it is almost certainly a scam. Listing on a centralized exchange comes with KYC and additional trust, and the bigger the exchange the better the reputation of a listed token.

7. Check the amount of liquidity in a token’s balance pool
Before you invest in a token, you may want to check general demand and the availability of liquidity. It is very easy to check a token’s liquidity on a platform like Uniswap V2 or other decentralized exchanges.

8. Check third party analysis tools
Smell Test – this does an automated audit of the token. The lower its score out of 100, the more likely the token is a scam.
Reference:- https://dappradar.com/blog/8-ways-to-check-if-its-a-token-scam