What is Pump and Dump and Why Should I avoid it?

Posted by Taras Lanchev on

Telegram and other messengers which are used for crypto have a lot of channels and groups which offer quick money from cryptocurrencies. They normally call themselves "Crypto Signals" or something of that matter. Please please please. Don't fall for this. Let's talk about why pump and dump is a scam and is a bad idea.

A diagram visualising a pump and dump scheme

For example, there is a Telegram channel called "Pump Notifier/Trading Signals". A few times a day that channel posts the name of the exchange where people will buy a coin and a countdown to when they should start buying. At the specified time, the channel sends out a message saying which coin people should be buying (and then selling). If you look at the channel you'll also see tons of garbage like: "Today we helped those who didn't make it. We re-pumped the coin. We never leave you behind". You get the idea.

An example of a scam message pump and dump groups send out to build trust

Currently, the group has more than 27 thousand members and of course, you can find positive reviews of the channel in Telegram and on WhatsApp. If you are not partaking but are in the group, it may seem as if it actually works and you can make money.

But the truth is - once you get the signal to buy you are already at the peak and most likely won't be able to buy on time. In fact, if you buy you are very likely to lose money because of all the people already selling the coin.

Easy money was never and will never be a thing! Think for yourself and don't fall for these kinds of scams!

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