How Traders 'pump And Dump' Cryptocurrencies

[aitorp6]

Hi there. 

Here you have a good article. It's a recommended lecture if you want to understand those pump-dump waves:

http://uk.businessinsider.com/how-traders-pump-and-dump-cryptocurrencies-2017-11/#pump-and-dump-scams-are-coordinated-through-groups-and-channels-on-the-app-and-advertised-in-advance-2

Any opinions about this?

[Ratko1922]

A pretty decent article, but needs more details. Whales also impact the price with the artificial walls and there are many pieces of information missing. It's not rocket science, but still.

[FrueGreads]

I wont say that those pump and dump groups don't exist, and since crypto trading is so recent, and anyone can take part, we probably still see people getting scammed that way, but I think the effect of those groups are getting smaller and will soon disappear as the market liquidity increases. Big money investors don't need those groups, and they can move markets by themselves right now, and I think that a lot of the pump and dump we are seeing, is done by big whales. They move the market, create a hype around it, and then manage to slowly cash out as other join, because they thing a pumping is happening. All these things will decrease as soon as we have decent market makers in the exchanges, and it would be impossible for big whales, and pump groups to move the market.

[pushkarmore]

Hi there. 

Here you have a good article. It's a recommended lecture if you want to understand those pump-dump waves:

http://uk.businessinsider.com/how-traders-pump-and-dump-cryptocurrencies-2017-11/#pump-and-dump-scams-are-coordinated-through-groups-and-channels-on-the-app-and-advertised-in-advance-2

Any opinions about this?

Well pump and dump is all going to end soon once the crypto exchanges and the crypto market gets some big market makers because till now everyone is understood about the pump and dump games and how the big whales were making the market moves. Anyways thanks for sharing the nice article.

[audaciousbeing]

I wont say that those pump and dump groups don't exist, and since crypto trading is so recent, and anyone can take part, we probably still see people getting scammed that way, but I think the effect of those groups are getting smaller and will soon disappear as the market liquidity increases. Big money investors don't need those groups, and they can move markets by themselves right now, and I think that a lot of the pump and dump we are seeing, is done by big whales. They move the market, create a hype around it, and then manage to slowly cash out as other join, because they thing a pumping is happening. All these things will decrease as soon as we have decent market makers in the exchanges, and it would be impossible for big whales, and pump groups to move the market.

Pump and Dump group really exist but the way its being run makes it shady and the group admin is always at the one that benefit the most and the strategy is simple. Its a game of population, when you have all of them into a group, they mostly use telegram where some tips are released to get people stuck to them but really its not a tip but something with adequate study, a newbie can easily predict.

After that, all the group admin need to do is to identify the a not so popular coin in an exchange site, buy as much as possible, then start  wetting the appetite of your followers of the time it would be tip would be released and when that is done, the rat race begin, while the members are trying to buy forcing the price high, the admin is trying to sell while only few members benefit due to the right timing to dump, others becomes poorer.

And the uniqueness about this group is that, only the admin is allowed to post, only him knows group members, only him gives reviews by members, only him determines those who making profit or losses and finally only him can decide when to shut down the group.

[anitaraymonds]

Thanks for sharing this write up. It will surely help because the information therein is valid and valuable.

[jhdscript]

I don't know how they pump big values like ETH or LTC but to pump altcoins is possible with few bitcoins I think

[buwaytress]

Looks like the "traditional" world of finance and business writing are trying to up their game, using crypto speak. I suppose it's a good article, probably new to a lot of their readers. But I'd be very, very surprised if the same strategies they talk about aren't used in conventional trading instruments. After all, the same FUD and FOMO derived from stock brokers making panicked calls to each other, buying and selling (pumping and dumping).

Anyway, interesting read, but the groups they talk about are barely scratching the surface, and seem to organise pumps/dumps on small coins (I struggle to avoid "shitcoin"). They also need to know a lot of P/D groups actually fail, since they're mostly amateurs.

This forum actually has quite a good history of old threads with very well written p/d stories. And here's a less crisp article but on a deeper level from Hacker Noon for you conspiracy theorists!

https://hackernoon.com/meet-spoofy-how-a-single-entity-dominates-the-price-of-bitcoin-39c711d28eb4

[BartS]

I wont say that those pump and dump groups don't exist, and since crypto trading is so recent, and anyone can take part, we probably still see people getting scammed that way, but I think the effect of those groups are getting smaller and will soon disappear as the market liquidity increases. Big money investors don't need those groups, and they can move markets by themselves right now, and I think that a lot of the pump and dump we are seeing, is done by big whales. They move the market, create a hype around it, and then manage to slowly cash out as other join, because they thing a pumping is happening. All these things will decrease as soon as we have decent market makers in the exchanges, and it would be impossible for big whales, and pump groups to move the market.

Those groups do not target big coins like bitcoin, you need to be a whale to impact the price of bitcoin at all, what they are doing is to look for coins with a very low market cap, those that know what it is going to happen begin to buy coins without arising suspicion then they tell their followers the name of the coin they want pumped and then they cashout and they get the benefits while everyone else gets losses.

[figmentofmyass]

Here you have a good article. It's a recommended lecture if you want to understand those pump-dump waves:

http://uk.businessinsider.com/how-traders-pump-and-dump-cryptocurrencies-2017-11/#pump-and-dump-scams-are-coordinated-through-groups-and-channels-on-the-app-and-advertised-in-advance-2

Any opinions about this?

this is nothing new. you could find these same pump-and-dump tactics employed on penny stocks in the yahoo finance forums! this has been happening since the early days of litecoin, when fontas was using the btc-e trollbox to pump and dump the first generation altcoins. anyone remember fontas?!

i see advertisements and shills for these pump groups all the time today (indeed, they are mostly telegram groups and things like that). but the fact is they are too small to manipulate the market for any real length of time.

what the group operators are really doing is shilling their current holdings to their followers. then they dump everything on them. that's it.

[EcoChavCrypto]

A pretty decent article, but needs more details. Whales also impact the price with the artificial walls and there are many pieces of information missing. It's not rocket science, but still.

And he forgot to say that most part of the pump & dumps scenarios are coming from telegram groups who have been "looking" to do those pumps and dumps before.


I joined a telegram signals group a few days ago, and all that they were giving on the Free chat were just signals, a few minutes after the price was suddenly pumped.

Guess what, you need to pay a membership of more than 0.02 btc a month to be able to join the premium chat and have access to receive the signals at the same moment as the other premium users.

It means that you will buy first, and the "free" members will pump the price and buy the alts that you bought before

That is pure science! Of course!.

[Low Sigma]

Looks like the "traditional" world of finance and business writing are trying to up their game, using crypto speak. I suppose it's a good article, probably new to a lot of their readers. But I'd be very, very surprised if the same strategies they talk about aren't used in conventional trading instruments. After all, the same FUD and FOMO derived from stock brokers making panicked calls to each other, buying and selling (pumping and dumping).

Anyway, interesting read, but the groups they talk about are barely scratching the surface, and seem to organise pumps/dumps on small coins (I struggle to avoid "shitcoin"). They also need to know a lot of P/D groups actually fail, since they're mostly amateurs.

This forum actually has quite a good history of old threads with very well written p/d stories. And here's a less crisp article but on a deeper level from Hacker Noon for you conspiracy theorists!

https://hackernoon.com/meet-spoofy-how-a-single-entity-dominates-the-price-of-bitcoin-39c711d28eb4

Pump&dump doesn't really happen anymore in traditional markets. The regulators use a lot of automated tools to raise a red flag and alert a person to have a second look.

On the other hand the problems on the "traditional" markets are different:
- front running a client order in fx market(it was something ordinary until a few were put into prison).
- high frequency traders sending lots of new/canceled orders to affect the ask-bid microstructure.
- manipulating the LIBOR used as a benchmark/free risk rate for modelling/pricing of financial instruments in the $trillion derivatives market.
- opacity of dark pools.

[sugihe]

A pretty decent article, but needs more details. Whales also impact the price with the artificial walls and there are many pieces of information missing. It's not rocket science, but still.

Pump and dump organize by a group that work specially for pump and dump.
There are other option also, whales who have big capital play the market.

[Raist]

Looks like the "traditional" world of finance and business writing are trying to up their game, using crypto speak. I suppose it's a good article, probably new to a lot of their readers. But I'd be very, very surprised if the same strategies they talk about aren't used in conventional trading instruments. After all, the same FUD and FOMO derived from stock brokers making panicked calls to each other, buying and selling (pumping and dumping).

Anyway, interesting read, but the groups they talk about are barely scratching the surface, and seem to organise pumps/dumps on small coins (I struggle to avoid "shitcoin"). They also need to know a lot of P/D groups actually fail, since they're mostly amateurs.

This forum actually has quite a good history of old threads with very well written p/d stories. And here's a less crisp article but on a deeper level from Hacker Noon for you conspiracy theorists!

https://hackernoon.com/meet-spoofy-how-a-single-entity-dominates-the-price-of-bitcoin-39c711d28eb4

Thank you for the link - very interesting. Ghostbusters have caught Spoofy Despite I do not believe that Bitfinex only is a lair of Spoofy gosts some graphs are representing very common activity for many big coins.
Telegram groups mentioned are giving right signals sometimes. But that's become really risky regarding small coins. Chances that community can be manipulated in this case are way too big. Also the amount of small coins cannot withstand such "community rush" without extreme jumps.

[chris200x9]

I don't know how they pump big values like ETH or LTC but to pump altcoins is possible with few bitcoins I think

These pump and dump groups will not choose those high demand coins because once prices go high there will be a people who bought earlier than these guys may start dumping coins then it will reduce profit to those group admins so they cleverly accumulate at low volume coins in advance and after pump announcement they start selling at higher price and buyers will lose money.

[jerry0]

Is a good example when a coin goes up a lot very quickly? 

[farhaan]

Pump and dump is usually done in altcoin markets and even there are services which provide pumping of a coin.Especially,it is used to pump newly released coins in the market to get a good start.They mostly do such pumps and dumps in newly released coins.

[Tynovten_]

I ever read an article, it said in the trading, some people do the price manipulation (pump or dump), maybe 80 or 85%. They always do that to get the trader.

[BartS]

Looks like the "traditional" world of finance and business writing are trying to up their game, using crypto speak. I suppose it's a good article, probably new to a lot of their readers. But I'd be very, very surprised if the same strategies they talk about aren't used in conventional trading instruments. After all, the same FUD and FOMO derived from stock brokers making panicked calls to each other, buying and selling (pumping and dumping).

Anyway, interesting read, but the groups they talk about are barely scratching the surface, and seem to organise pumps/dumps on small coins (I struggle to avoid "shitcoin"). They also need to know a lot of P/D groups actually fail, since they're mostly amateurs.

This forum actually has quite a good history of old threads with very well written p/d stories. And here's a less crisp article but on a deeper level from Hacker Noon for you conspiracy theorists!

https://hackernoon.com/meet-spoofy-how-a-single-entity-dominates-the-price-of-bitcoin-39c711d28eb4

Pump&dump doesn't really happen anymore in traditional markets. The regulators use a lot of automated tools to raise a red flag and alert a person to have a second look.

On the other hand the problems on the "traditional" markets are different:
- front running a client order in fx market(it was something ordinary until a few were put into prison).
- high frequency traders sending lots of new/canceled orders to affect the ask-bid microstructure.
- manipulating the LIBOR used as a benchmark/free risk rate for modelling/pricing of financial instruments in the $trillion derivatives market.
- opacity of dark pools.

And how you can be so sure that no longer happens, it may be illegal now to use pump and dump tactics on traditional markets but that does not mean it is not happening, if we take into account all the money that is at stake and human greed then it is very obvious to me that is still happening, just look at the ponzi scheme by Madoff he scammed a lot of money with a very old tactic.

[Tactical Genius]

Well,the pump and dumps i saw couldn't really affect the price of the currency significantly and more over the coins that were pumped are either very new on the market or not a solid and established currency like the mainstream ones we know.Funnily,it is easy to become a bag holder from such schemes especially for noobs.