Pump-and-dump in crypto is an orchestrated fraud that involves misleading investors into purchasing artificially inflated tokens — typically marketed and hyped by paying celebrities and social media influencers. You’ll typically find these popping up on your news feeds and YouTube feeds. Here are some tell tale signs on how to spot these pump and dump schemes.
- Theres a promise high levels of returns for low risk?
- There’s a sudden increase in the crypto price despite historically low trading volumes
- There’s pressure to make a decision quickly
- Theres a claim from the influencer that they have insider information
- Theres a lack of technical information in the white paper, only marketing speak