Real or fake? Learn how to identify legitimate stablecoins

At Coinbase, we’re working hard to help update the financial system by building trusted products that expand the utility and adoption of crypto, because we believe crypto and blockchain technology have the ability to increase economic freedom and opportunity around the world. Coinbase chose to become a public company in the US because we believe the US would best be served by embracing this fundamental innovation, but we’re also focused on international markets, many of which are moving forward with strategies to become “crypto hubs.” A key part of fulfilling this commitment is giving you the tools to safeguard your account including providing you with information about known threats and effective self-protection measures across all of our products and services, including Coinbase Wallet.  In recent months, we have observed a sharp increase in the number of fake stablecoins being used to pay Coinbase Wallet users for goods and services, or as “rewards” connected with various DeFi mining and pig butchering investment scams. As these are not legitimate stablecoin contracts, the tokens are worthless and do not have a value associated with them. It’s important to know how to protect yourself against these sort of scams and learn how to identify illegitimate USDC and USDT tokens.

Verifying your USDC and USDT Tokens

Method 1: Via Etherscan

Both USDC and USDT are ERC-20 tokens, and they have verified contracts which can be checked on Etherscan. Etherscan is a blockchain explorer that provides detailed information about transactions and addresses on the Ethereum blockchain. Learn how you can check your transaction status. 

There are ways you can verify your transaction based on your USDC and USDT Contracts on Etherscan. We’ve shared some images below to help you understand the verification process. 

1. The first image shows a genuine USDC contract and how it appears on Etherscan.  You will see a blue check mark next to the USDC token name, a fully diluted market cap for USDC, the official USDC site, and a token address contract that is unique to the genuine USD coin. A genuine USDT contract will also have these attributes. 

2. The second image shows an example of a fake USDC contract  and how it appears on Etherscan. You will see that there is no blue check mark next to the USDC token name, no value associated with the token and no market cap, and that the token address contract differs from that of genuine USDC. These attributes can also be checked to verify if a USDT contract is real or fake.

Image 1: Verified USDC contract as shown on Etherscan

Image 2: An example of a fake USDC Contract as shown on Etherscan

Method 2: Via the Coinbase Wallet

Genuine USDC and USDT will always render in Coinbase Wallet with the exact dollar amount associated with it. For example, 250 USDT will be $250 and 250 USDC will be $250.  USDC will always render in Coinbase Wallet with the official USDC logo with an ETH symbol in the lower right corner of said logo.  The same applies to USDT. 

Fake USDC and USDT tokens will be rendered in Coinbase Wallet with no dollar amount associated with the token. Fake USDC and USDT will not have verified contracts on Etherscan. You can see how fake tokens appear in Coinbase Wallet in the image below.

Image 3: Fake Tokens in Coinbase Wallet

Protect yourself by hiding tokens

Fake tokens are created with the intent of deceiving users -- sometimes the intent is to deceive a user in regards to the perceived worth of a token, and sometimes it may be to elicit a user to claim an airdrop. The term “airdropped tokens” refers to tokens that appear in your wallet without you purchasing them. Claiming an airdrop requires you to connect your wallet to a smart contract in order to claim these tokens, so it is a high risk transaction. You can hide tokens within your wallet without having to interact with the underlying contracts. You’ll start by opening your Coinbase Wallet and navigating to the settings section at the bottom of your app. Under the “Display” header, you’ll see “Hide assets.” Enter the asset name you’d like to hide. This does not require any interaction with the underlying contract, and is safe.

While airdropped tokens can be a way for new projects to quickly gain user adoption, they can also be a vector for scammers to capitalize on the “fear of missing out” – aka “FOMO” – many web3 users can feel.  Learn more about airdrops. 

Safeguarding our community

In conclusion, while we strive to ensure that our users are never targeted by scams, it is crucial to be knowledgeable about self-protection measures. To that end, we would like to offer the following tips:

• Firstly, always remember to verify the URL before connecting your wallet to a dapp.

• Secondly, thoroughly double-check the recipient address before sending any amount of cryptocurrency, and also confirm the tokens you are interacting with. If any doubts arise, it is advisable to refrain from proceeding with the transaction or engaging with the token. 

• Lastly, if you come across an unexpected token in your wallet, exercise caution and refrain from interacting with it.

With a little bit of extra vigilance, you can continue to enjoy the world of web3 and participate in the emerging financial ecosystem. At Coinbase, we are dedicated to prioritizing user security and providing our customers with the necessary resources to safeguard themselves in the realm of web3.