I am sure that everyone that is into cryptocurrencies have heard about Pump & Dump groups. It's hard to avoid the ads from the Pump & Dump groups, especially if you are in any Telegram, Slack or Discord groups. The ads are often fake and manipulated facts on how successful they have been with earlier pump and dumps.
People joining these groups are thinking of earning some fast and easy money, but they don't know that they're the ones that are being fooled.
Let my explain:
The people behind the P&D groups creates two groups:
- A secret group for themselves (the admins). Let's call it the Admin P&D group
- A public group or fake secret group for the rest of the members. Let's call it the Open P&D group
The members of the Admin P&D group discusses which coin to pump next, when to do it, and how to do it. After that they start by buying big volumes of the coins, but in small fractions over several days, and sometimes even on multiple exchanges, just to be sure noone will notice it, and without pushing the price upwards.
Then they tell the members of the Open P&D group that they will announce the next pump like this: "The next pump will be announced in 8 hours", and they post this several times with a countdown. They will only announce on wich exchange it will happen so you have your Bitcoin or Ethereum ready.
Then when they announce the pump and how they want you to do it, you start buying the coins and pushing the price upwards. They also want you to share the news in different groups so people start buying it because they want you to believe people will join because of FOMO (Fear Of Missing Out), while in reality it's only the members of the group that are pushing the price, with help of some fake buy walls from the admins. The pumped coins value often gains 30-40 % or even double or triple the value in just a few seconds. When the price has been pushing a lot they dump all their coins on you, and when they have finished selling all their coins, you will be notified to sell yours. But when you get the message about selling, it's already too late and you will be left with the coins while the price dips back to the normal level.
Conclusion:
- The Pump & Dump groups are only made to help the people behind it, while the members are left behind with losses, and sometimes big losses. So be cautious and don't be fooled by these scammers. Never join any P&D group and if anyone asks about it, tell them how it works to prevent them from joining.
Good information, I don't actually follow signals from pump and dump groups. Of course, I am aware that whenever signals were made those who usually gives out the signal were already able to buy their coin at cheap price and waiting for those who were late for the signal to buy it. And, of course, they dump ahead before sending out another signal to dump. So, most likely, pump and dump groups are just groups of market manipulators.
