Can someone explain how pump and dump allegedly works?

[andypagonthemove]

If you pump the price by buying, driving the price up, and then unload all the coins you wanted to get rid of, don't you just drive the market priced down past where it was and end up with more coins than you initially had to sell? I just don't get the logic.

[Ciscopro2000]

Ideally you already have the coins.  You then basically start pumping them by telling your friends, family, business associates, acquaintances, the internet how great the coins are.  All the while you are dumping the coins on the market.  You are hoping the people who are buying on your advice will raise the prices of the coins, thus netting you a nice profit.  Everybody else will eventually be left holding the bag once they find out your advice is nothing but hot air and prices start dropping. 

[Autumn_Rain]

Large groups of people or whales can influence the market easily.
In simple words, when they want to sell their coins, they pump up the price by manipulating the market via the exchanges by placing higher prices for the coin.
When they are quite satisfied with the result, they sell it to people who got caught with this trick thinking the market is recovering and the price will boom even higher. Dumping is a similar but just an opposite process which happens when they need to buy the dip.

[odolvlobo]

If you pump the price by buying, driving the price up, and then unload all the coins you wanted to get rid of, don't you just drive the market priced down past where it was and end up with more coins than you initially had to sell? I just don't get the logic.

Yes. You are correct. Many people (such as Autumn_Rain) don't understand how it works.

Here is how pump and dump really works:

• 1. The scammer buys the coins. Usually the buying is done slowly in order to prevent lack of liquidity from driving the price up, but sometimes the scammer is willing to let the price rise and pay more. See (A).
• 2. The scammer promotes the coin in various ways on social media. This is the "pump". See (B), (C), and (D).
• 3. If the scammer's promotion is successful, the price begins to rise as more and more people are suckered into buying. Contrary to popular belief, this is not the "pump", #2 is the pump.
• 4. As the price rises, the scammer sells to the victims, getting a better and better price until they have unloaded their coins. This is the "dump".
• 5. Eventually, the demand for the coin dries up and the price plummets because there are no buyers and everyone is selling. Note that the scammer has already sold all of their coins before this point. People that don't sell or are "buying the dip" are left with coins that are as worthless as the were before the scam started.

Contrary to popular misconception, the scammer (or manipulator) doesn't drive the price up by buying because that is too risky and it generally doesn't work.

Notes:

• A. If the scammer is reasonably skilled, they may intentionally allow the price to rise when they are buying even though it increases their risk of loss. They make the rise part of the story that they use to convince the victims to buy.
• B. In the classic "pump-and-dump", scammers promote the coin by simply posting lies about how the coin is going to explode or "moon" on forums, twitter, reddit, facebook, etc.
• C. One popular pump-and-dump scam is a newsletter or a "signals" group. The members are the intended victims. In this case, the scammer simply buys a coin and then tells the members to buy it because it will go up any day now. This is basically the same as a classic pump-and-dump, but it is more sophisticated as it attempts to scam the members over and over.
• D. Another popular pump-and-dump scam is a "pump" group. Again, the members are the intended victims, though members may be led to believe that non-members are the victims. In this case, the scammer convinces the group that if everyone buys at the same time, the price will go up and they can sell at the higher price. Of course, that doesn't work. What really happens is that the members buy from the scammer at inflated prices and then the price collapses.

[/list]

[lomberer]

I think this article explains pretty clearly about how it works:

https://steemit.com/bitcoin/@joseph/wolong-the-game-of-deception-unedited-version

It is a manifesto from Wolong, famous for his work on the pump and dump scene for dogecoin. It involves a fair amount of capital and social engineering in order to convince people to follow along. I think you'll particularly be interested in the 'Exiting' section of the document as it explains some of the methods used.

[Mr.Ease]

You buy a whole ton of tokens. Basically, You over-buy up the supply, then put another couple massive buy orders higher than where you bought said tokens.
Hopefully, bots or other users will increase there buy orders above yours = Price PUMP.
Then you slowly sell at profit until you deplete your supply

Remove buy walls = Price DUMP

It's risky, because you can find yourself stuck with a massive supply of shit tokens that no-body, not even bots, wants to buy 

It's probably the best, and easiest way to burn yourself. Search for better options

[GlobalFuneralCare]

Maybe this video might be helpful: https://www.youtube.com/watch?v=MD71I2XgvcI. It is a brief introduction of how it works. Although I would say, please be very careful, because it is a very high risk way to gain your portfolio.

[tabernacle]

This is usually done in scammy telegram groups that offer investment advice. One thing that people didn't cover here is that sometimes the groups "leaders" announce that this specific coin is going to raise because of this news, so they pump the coins slowly for few cents to make it look legit. People on that group will eat the bait and then the massive pump starts, where the "leaders" start dumping and netting profit while the average Joe is left hoping to get his initial investment back.

[KingScorpio]

market is full of idiots they only look at current price not the volumes behind. this way, the asset issuers, can always by back small volumes and raise the official price, till the idiots are dumping it again.