Hello to my friends who love life and keep smiling despite all kinds of negativity. In this article, I will talk about "PUMP&DUMP" that you often hear in the cryptocurrency markets. I will try to explain it as simply as possible. Let's learn together…
The term "pump&dump" (P&D) can be explained as "Pump and Drop the Price". This method causes big fluctuations in the price of crypto coins. The surprising thing is that this "manipulation", which is done in secret in traditional markets, is openly done in the cryptocurrency markets.
There are many Pump&Dump groups on social media platforms such as Telegram, BitcoinTalk, Reddit and Discord. Investors who come together and form these groups buy altcoins at a certain price and sell collectively when the price peaks. Thus, the price goes up in a short time and returns to its previous level after a while. When the price rises, they buy investors who are not aware of anything, because of the wrong and distorting information by these people.
These groups, of course, cause great harm to ordinary investors.
Oleg Seydak, CEO of Blackmoon firm
P & D's negatively affect the market and easily lead to FUD (fear, uncertainty and anxiety) in the general crypto community. This manipulation unfortunately affects the vast majority of new investors. If we want the market to develop, we need to get hands on and close these channels and groups.
Investors need to be extra vigilant against fraud until regulators take legal action against P&D traps. In fact, such situations are entirely based on human psychology. By analyzing the psychological profile of the people they target, fraudsters officially become a persuasion expert.
FOMO is always featured in P&D groups. The organizer of the group announces the stock exchange and time when P&D will take place, specifies the tokens. At the time of the event, many people comment such as "T coin flies!", "It is very cheap now, buy it when you have the opportunity".
Extra attention is needed against cryptocurrencies with recently finished ICOs. Because it is estimated that this is implemented in one of every 10 ICOs. It is pointed out that ICOs, realizing that they will not reach the investment target, use the Pump & Dump tactic. The strategy is to blockade users from all social media channels and constantly pump "good news" to users.
On the other hand, it is seen that crypto coins are generally suitable for manipulation.
An investor can change the market by placing a large amount of buy and sell orders on a large number of tokens in the exchange. Rising token price in one exchange can affect the price on other exchanges.
As the market develops, P&D groups and fraudsters will be identified and weeded out one by one with the regulations made. Until then, we can say that many people will shed tears. The important thing is to stay away from onions and such traps.
In finishing…
I think Pump&Dump groups and fraudsters will decrease with the development of the cryptocurrency market, the regulations made and to be made and the awareness of the investors. During this time, many people will lose their assets. The most important task here is the investors. They need to analyze the cryptocurrencies they will invest well. It is necessary not to rush. Opportunities do not end in the cryptocurrency markets.
As I always said, listen to everyone, decide for yourself ...
I'm looking forward to your comments. Thanks to your comments, we can shape my next articles together. Let's stay in touch… Take care of yourself so that you and the people around you are happy…
