Topic: The pump and dump scheme - page 2. (Read 229 times)
Many people just see the price pump and they started investing in it. In recent i saw many people when they saw Dogecoin pricevpump. They also started ingesting in it without research why price pump and either Dogecoin has any new partnership or feature launched. Price dropped very soon and hurts many traders..
In general, once the initial buyer who began the scheme exists the markets, and the publicity campaign wanes, the prices will fall, and anyone who holds the shares or tokens will see big losses. That, in short, is the pump and dump scheme.
This is just a typical definition on how pump and dump scheme works and this is actually true and most people who get victimized into this scheme is to those people who are
easily just get dragged with the hype and without even tending to make some further or in depth research before they do make out some investment but rather they do
directly put up their money blindly just because they do saw that the price is hyping without even realizing on whats the project is all about but rather people would
realize when its too late and this would really be ending up on holding lots of shitcoins into your wallet which is the common result.
The pump and dump scheme isn't new, as it has been employed extensively in the equity markets for a long time. The idea behind the scam is very simple. A person or group will buy a large amount of a security or a token that is thinly traded (this aspect is very important), and by doing so, the price will rise.
As the initial buying causes a rise in price, the entity behind the buying will begin to promote the asset, generally in informal media. As more people jump into buying, the price will rise further, and people will tend to get excited about the prospect of further gains.
The entity that was behind the initial buying and publicity push is now ready to cash out their holdings at a much higher price level, and lock in some big gains. Anyone who has come to the market late in the cycle will be stuck with the asset and no more buyers, which is the end of the scheme.
In general, once the initial buyer who began the scheme exists the markets, and the publicity campaign wanes, the prices will fall, and anyone who holds the shares or tokens will see big losses. That, in short, is the pump and dump scheme.
As the initial buying causes a rise in price, the entity behind the buying will begin to promote the asset, generally in informal media. As more people jump into buying, the price will rise further, and people will tend to get excited about the prospect of further gains.
The entity that was behind the initial buying and publicity push is now ready to cash out their holdings at a much higher price level, and lock in some big gains. Anyone who has come to the market late in the cycle will be stuck with the asset and no more buyers, which is the end of the scheme.
In general, once the initial buyer who began the scheme exists the markets, and the publicity campaign wanes, the prices will fall, and anyone who holds the shares or tokens will see big losses. That, in short, is the pump and dump scheme.
Jump to: