What Is a Honeypot in Crypto? Meaning and How to Spot One
Honeypot: A honeypot is a scam token that lets you buy but stops you from selling, through a freeze permission or hidden contract rules, so your money stays trapped while the scammer cashes out.
Key takeaways
- A honeypot is a token you can buy but cannot sell; the chart often looks green because only buys go through.
- On Solana, an active freeze authority lets the creator freeze holders' token accounts, which blocks their sells.
- On EVM chains like Base, the trap usually sits in the contract code, for example a rule that blocks or taxes sells.
A honeypot is a token you can buy but cannot sell. Buyers see the price go up and put money in, but when they try to sell, the transaction fails. CoinMarketCap Academy lists honeypot coins as one type of honeypot scam, a scam that lures people in to take their funds. It is one of the main types of rug pull.
How it works
On Solana, the usual tool is the freeze authority. The SPL Token docs say it can freeze a token account, and token instructions that include a frozen account fail. If the creator keeps that permission, they can freeze buyers so they cannot sell.
On Base and other EVM chains, the trap is in the contract code: a blacklist, a sell tax close to 100%, or a rule that lets only the creator's wallets sell.
Example: a new token shows only green candles and hundreds of buys in an hour. Each buyer tries to sell and fails. The creator sells their own supply into the pool and leaves.
Why it matters for traders
A honeypot looks like the best chart on the screen. Before you buy, check the authorities or the contract, look for real sells in the trade history, and test a small sell. Some trading tools show these checks; the sniper bots hub notes which bots document mint and freeze authority filters.