Defending Yourself against Common Pump-and-Dump Cryptocurrency Scams

The pump and dump crypto schemes have been around before cryptocurrency was invented. The only difference now is that it is done openly now in the crypto industry.
For instance, on BitcoinTalk, Telegram, and Reddit, some people can come together with an agreement to buy bitcoins/ altcoins at a particular price and then sell when the price peaks. They go around spreading false rumors to persuade investors to buy during that period.
However, they should be given some credit, as they don’t hide their activities.
Business Insider reported that these individuals occupy the top 5 P and D chat groups on the Telegram app. Some include
PumpKing Community with 14,317 members
Crypto4Pumps with 7,602 members
AltTheWay with 5,582 members
Pump.im with 148 members
OCPump with 1,281 members
Even though such transparency may be refreshing, the prevalence of such groups emphasizes the hazards facing unsuspecting investors in the cryptocurrency trade.
It affects the overall market price and also creates uncertainty, fear, and doubt in the community.
Potential solutions to the problem
Whistleblowing is the way forward. The U.S agency, the Commodities Futures Trading Commission that regulates derivatives has announced in February that it is offering whistleblowers a bounty for information that halts these actions.
Another solution is establishing a self-regulatory organization. However, experts aren’t sure how such an agency can come in handy.
Until the authorities can make rules to stop pump and dump scams, potential investors must be careful so they won’t be scammed.
To keep yourself safe, remember that psychology is the main ingredient of the scam. Fraudsters are usually masters of persuasion. They may tailor their plans to tap into the psychological profiles of their targets.
Always remember that if it sounds too juicy to be true, it probably isn’t true.
Always keep your guard up when you encounter such individuals.

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