What is Pump and Dump

A "pump and dump" strategy is a deception in which the value of an asset rises and then falls precipitously. Typically, pump and dump systems are unlawful. The decentralized crypto market, on the other hand, is unregulated. Crypto "pump and dumpers" are typically found on social media platforms, and they frequently collaborate in groups to give the appearance of widespread interest in a currency or token. Scammers who "pump and dump" financial assets deceive their audience, causing additional investors to purchase. When the price has increased sufficiently, the criminals benefit from the investment while others lose. Schemers frequently purchase a large quantity of the assets in order to activate the "pump." Pump-and-dump strategies are particularly prevalent in small and micro-cap assets with low liquidity, where large value swings are simpler to achieve Due diligence, skepticism about unexplained price increases, and understanding of affinity fraud can help safeguard investors from being duped by a "pump and dump."

Cripto Termen