Bitcoin Bump and Dump case explained
Mar 17, 2018 Posted / 6615 Views
Have you ever been in the relationship?, Have you ever been dumped?, Don’t you feel bad when you think of all those false promises and time you wasted because of that promising expectations will you feel little less bad if I tell you it’s a type of scam? Yes, you heard it right. Its a scam, you have been scammed. It's old style fundamental scamming procedure.
Now don’t scrutinize me, I know its all about Cryptocurrencies here but this is just an analogy. Yes, these scams are becoming more and more common nowadays in the crypto market as well in which scammers use this old-school technique to scam and runoff.
With the major success of BTC as a digital asset, people are searching for the same type of opportunity to stack their pockets with lots of money.This opens a window of opportunity for scammers to catch hasty investors in a loophole of being scammed.
One must not purchase BTC, virtual coins, or tokens because of some social media news or predictions or sudden price spikes. Nowadays you can find an advertisement for a cryptocurrency everywhere, whether it be online or offline, everyone is offering you coins that can make you rich overnight.
So how do pump and dump scheme works?
As per official description of CFT Historically, they were the domain of “boiler room” frauds that aggressively peddled penny stocks by falsely promising the companies were on the verge of major breakthroughs, releasing groundbreaking products, or merging with blue chip competitors. As demand in the thinly traded companies grew, the share prices would rise. When the prices reached a certain point, the boiler rooms would dump their remaining shares on the open market, the prices would crash, and investors were left holding nearly worthless stock. Although the scams have been around as long as the virtual currency and digital coins markets themselves, the number of new virtual currency and digital coin traders has grown substantially, increasing the number of potential victims or unwitting perpetrators."
How to protect yourself from these kinds of fraud :
1) Do not purchase virtual currency on the basis of the single tip, especially if it comes over social media.
2) Do not believe in schemes that promote themselves to make you wealthy overnight. Research thoroughly about the currency you are buying and the companies behind it.
3) If you believe you may have been the victim of fraud, or to report suspicious activity, contact the CFTC at (866) 366-2382 or visit CFTC.gov.
Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .
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