The pump and dump is dead, long live the pump and dump!
For newcomer in the crypto world, it may seem like there are opportunities everywhere, but most of them are unfortunately scams …
We are going to talk about a special one : the pump and dump.
What is a pump and dump ?
Quite simply , a pump and dump is a financial scheme performed by a group of people trying to artificially execute the famous buy low sell high.
They usually choose some low marketcap coin, then start to buy a big amount to make the price rise.
Why ? To make people FOMO aka Fear Of Missing Out. You may not believe it, but there are a lot of innocent (foolish ?) crypto investors out there waiting to buy the next mooning coin.
It may sound ridiculous, but we all did it in our early days as crypto investors. Yes, you remembered the sh*tcoin you bough when you FOMOed right ?
Anyway, after seeing the price skyrocketing in a short amount of time, people other than the original group start to buy. And here comes the dump : since the price is above these scammers(yes, it is a scam !!!) entry price, they sell with some profits.
That’s basically a pump and dump scam. The sooner you get in, the more profits you make.
How to spot a pump and dump
Let’s say you wake up at 6am (i don’t …) and the first thing you do as a crypto addi… enthusiast is obviously to check cryptos prices( I do !). You sort the coins by price variations and … WOW +20% for some unknown (sh*t ?)coin …
So how do you determine if a pump and dump is happening or not ?
Since almost every coin has a twitter account, you have to check if there was an announcement in the past 24h. If there was indeed some legit tweet, you have to ask yourself if it was important enough for the price to pump that much ?
There are a lot of fake twitter accounts and a HELL LOT of fake news to pump the price, be sure that you are checking the official account.
Same as Twitter, you can check the subreddit of the coins to see if there are some new discussion about some awesome news or not.
Don’t be fooled by some fake discussion between fake accounts !
Some projects have a Medium account and, usually when there is a big news like a product release or listing on a some trading platform, there is an article about that.
How to spot a pump and dump simply and quickly
I give you that checking all the official social media account and discussion to see if something is happening can be a pain in the ass. Going on Twitter, finding the official account, then Reddit, looking for the right subreddit and finally searching on Medium can be long.
An easy way to do all the step above is the mobile app Totem.
It gets you all the news and discussion about the coins you want from the coins team’s official Twitter, Reddit and Medium accounts.
So basically, all you have to do if you find a weird price movement is to type the coins name and click on it to see all the official news and announcements.
And of course, you can add it to your portfolio to keep an eye on it.
If you want to know more about Totem and give it a try, here’s the website :
