pump and dump

Peter Schiff Warns of Bitcoin ‘Pump and Dump’ — Expects to See a ‘Massacre’

February 14, 2024 Bitcoin.com

Reddit mods dumped tokens hours before blockchain program termination

October 20, 2023 Coin Telegraph

Analysis of token movements from Redditor moderators' wallets suggests at least three moderators dumped thousands of dollars worth of Moon tokens just minutes before the actual announcement.

Popular social network platform Reddit announced the wind-down of its blockchain-based community points program on Oct. 17 citing scalability issues. The announcement created controversy in the crypto community with many calling it a rug-pull as the price of the native token on different subreddits tanked after the announcements.

Each subreddit had its own native token. For example, the Moons (MOON) token was the native crypto asset of the r/CryptoCurrency board, while Bricks (BRICK) was for the r/FortNiteBR subreddit. Users could spend these points on badges and exclusive items for their avatars.

At the time of the announcement the moderators of most of the subreddits involved with the community points program claimed to be unaware of the decision. However, this is now being called into question as new on-chain data suggest at least a couple of moderators holding Moon tokens may have been linked to three wallets that dumped millions of the tokens shortly before the actual announcement.

On-chain analysts such as Pledditor were the first to draw attention to the actions of a subreddit moderator with the pseudonym Mcgillby. On-chain data reveals that this moderator transferred more than 100,000 Moons over two different transactions on the Arbitrum Nova blockchain, turning them into more than $23,000 in ETH. The user subsequently deleted all earlier Reddit posts.

.@Reddit admins told /r/CryptoCurrency moderators beforehand, and 3 moderators sold $MOON tokens on insider information$MOON price dropped -22% minutes before the announcement was posted

Here is a list of Reddit moderators acting on inside information BEFORE the announcement: pic.twitter.com/xAh75hOVEa
— Pledditor (@Pledditor) October 18, 2023

In another incident, just 17 minutes before Reddit's open statement, "rider_of_the_storm," a different moderator, allegedly shifted 345,422 Moons, worth over $69,000 at the time, to an exchange address. The Reddit account in question has since been deactivated. According to Lookonchain, on-chain data showed that at least three of the administrators overseeing the cryptocurrency subreddit liquidated tokens some 20 to 30 minutes before the announcement went public.

1/ Three @CCMOD_ moderators dumped $MOON in advance via #inside information from @Reddit admins. pic.twitter.com/ucrPkh6siX
— Lookonchain (@lookonchain) October 19, 2023

A cumulative statement from the Reddit moderators clarified that they received the notice about the termination of the community points program an hour earlier, suggesting at least three moderators may have used the prior information to dump their token holdings.

Magazine: Blockchain detectives — Mt. Gox collapse saw birth of Chainalysis

Nima Capital goes dark after dumping 9M SYN tokens, community calls it VC rug

September 5, 2023 Coin Telegraph

Coin Telegraph

The VC firm had received a grant from the project in return for locking $40 million worth of liquidity in SYN.

The price of the native token of the decentralized finance (DeFi) cross-chain bridge Synapse (SYN) plummeted on Sept. 5 after an unknown liquidity provider on the platform dumped nearly 9 million SYN tokens and pulled all stablecoin liquidity from the bridge.

The official X account for Synapse acknowledged the liquidity rug by an “unknown liquidity provider,” while clarifying that the Synapse bridge didn’t face any security breach.

A Synapse liquidity provider sold their SYN tokens and removed liquidity today. We're investigating unusual activity on their wallets and are working to get in touch with them. Will update once there is more info.

There was no security breach of the protocol or bridge.

4
— Synapse Labs (@SynapseProtocol) September 5, 2023

The unknown liquidity provider in question was traced to Nima Capital, one of the long-term capital partners of the project. The venture capital firm had received a grant from the project in return for locking $40 million worth of liquidity in SYN. Etherscan data suggests the unknown whale that dumped the SYN token received 10 million SYN ($3.4 million) from the “Synapse: Executor 2” wallet on April 5 and currently holds no SYN tokens in the wallet.

The VC firm rug pulled its users just eight months before the agreed governance proposal. This became evident after the Nima Capital website went offline and the project also locked its X (formerly Twitter), going dark online, prompting many to call it a VC rug.

Even VCs are rugging now @NimaCapital dumped 9M $SYN and removed all stablecoin liquidity 8 months before the agreed gov proposal

Their site went offline and twitter protected too https://t.co/ShlYcZhFbz pic.twitter.com/1ncxP13XYV
— Wazz (@WazzCrypto) September 4, 2023

Rug pulls are quite a common form of scam in DeFi ecosystems, where the project creators or developers often change the code or pull the plug on the project after the native token of the project reaches a certain price threshold. However, a rug pull by a VC firm is uncommon.

The price of SYN fell more than 20% as a result of the token dump, registering a multi-week low of $0.30 before recovering to above $0.35 later in the day.

While DeFi bridges make interoperability easier among different protocols, they are often the primary target of exploiters, with some of the biggest DeFi hacks taking place on these cross-chain bridge protocols.

Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.

Magazine: Should crypto projects ever negotiate with hackers? Probably

Court rules in favor of HelbizCoin investors, class lawsuit to go ahead

September 4, 2023 Coin Telegraph

class action

A U.S. District Court has upheld claims by HBZ investors that the company acted fraudulently and also asserted that its token violated securities laws.

A United States District Court has allowed a nearly three-year-long class action lawsuit against the creators of HelbizCoin to go ahead, as per a court ruling filed on Sept. 1.

The class action suit was first brought against Helbiz, its CEO Salvatore Palella, and its partners in 2020, with an amended complaint filed in March 2022.

The case involves an Italian electric scooter-sharing company HelBiz that raised $38.6 million in an ICO and issued an ERC-20 token with one of the founders of Ethereum, Anthony Di Iorio, in 2018, according to the complaint.

A group of investors, numbering as many as 20,000, alleged that HelbizCoin was a rug pull and fraudulent pump-and-dump scheme with the firm making false statements and promises to induce people to purchase the coins. They claimed that Helbiz kept most of the money from the ICO for itself.

On Sept. 1, the US District Court for the Southern District of New York partially ruled in favor of investors who filed the class action suit, with the court granting the motions to dismiss in part and denied them in part.

*Screenshot from court ruling shared with Cointelegraph*

The court however dismissed all claims against certain defendants entirely, including Paysafe, Skrill, Decentral, and Alphabit, finding a lack of personal jurisdiction over Paysafe and Alphabit. The court also dismissed some claims against the remaining defendants for failure to state a claim, including breach of contract, tortious interference, and certain securities claims.

However, Judge Louis Stanton also ruled that plaintiffs adequately stated claims for fraud, price manipulation, violations of securities laws, commodities laws, the RICO (Racketeer Influenced and Corrupt Organizations) Act, and unjust enrichment against some defendants.

“Among other matters, the case found that the ERC-20 token is a security under federal law,” the investor’s lawyer Michael Kanovitz told Cointelegraph.

The investors' lawsuit was initially dismissed by a lower court judge in January 2021, citing a 2010 Supreme Court precedent that limited the extraterritorial reach of federal securities laws, according to a report from Reuters.

However, the case was revived in October 2021 when a 2nd U.S. Circuit Court of Appeals found the lower court judge erred in its decision, and an amended complaint was filed in March 2022.

In emailed comments to Cointelegraph, Kanovitz also pointed out that the complaint included a number of charts that use the Ethereum ledger to “prove spoof trading in the ICO.” It also included evidence of multiple "genesis wallets" that were provided to the initial investors in Ethereum, such as Mr. Di Iorio, he said before adding:

“It is a compelling story that shows how blockchain transparency can be used to flush out criminals.”

The complaint alleged that Di Iorio, an advisor to Helbiz, published false and misleading statements about the HelbizCoin ICO in Bitcoin Magazine but did not provide evidence that he made the statements.

“This is a speculative conclusion at best and thus fails to adequately allege that Di Iorio made false or misleading statements,” the ruling read.

Magazine: Crypto regulation: Does SEC Chair Gary Gensler have the final say?

3 signs PEPE token is about to trap bulls after 2,000% price rally

May 3, 2023 Coin Telegraph

Coin Telegraph

PEPE price risks losing 20% in May due to shaky technicals, waning retail interest, and too many risks of market manipulation.

New meme-coin Pepe (PEPE) has entered a sharp correction phase after surging by more than 2,000% since its debut a few weeks ago.

On May 3, the PEPE price dropped to $0.00000089, down about 35% from its record high of $0.00000138 established two days ago. As a result of the correction, its market capitalization slipped by nearly $80 million, thus pushing it out of the top-100 top cryptocurrency index.

*Pepe price performance since market debut. Source: CoinGecko*

A mix of technical and fundamental indicators hint at further downside for PEPE price.

Retail interest falls

PEPE's daily trading volumes declined across centralized (CEX) and decentralized exchanges (DEX) as prices fell. The same happened to the Google trends for the keyword "Pepe Coin," whose score is down from 100 to 7 in a day, suggesting that the retail hype has subsided in the past 48 hours.

*Interest rate for the keyword Pepe Coin. Source: Google Trends*

PEPE whale distribution is worrisome

The top 100 richest PEPE addresses, aka "whales," control 45% of the token's circulating supply, according to data tracked by CoinCarp.com.

*Top PEPE distribution. Source: CoinCarp.com*

These 100 addresses might belong to 100 different individuals. But one entity can control more than one address, which gives a limited number of whales more say over the direction of PEPE future price trends, increasing risk of price manipulation.

For instance, Lookonchain revealed that five addresses allegedly linked to the Pepe team made a $1.23 million profit in a thin liquid market. They purchased 8.87 trillion PEPE tokens at a low price and sold over 90% of their holdings at a higher price on Uniswap.

*PEPE buying and selling schematic. Source: Lookonchain*

Some of the top PEPE holders are centralized exchanges. But, according to data tracked by analyst 008.eth, non-exchange PEPE whales have reduced positions recently, hinting at profit-taking that coincided with the ongoing price correction.

20% PEPE correction ahead?

PEPE has rallied without any concrete fundamentals behind it, and the evidence of fewer whales controlling the uptrend could negate the gains in the short term. Technicals concur.

For instance, the four-hour chart shows that PEPE/USDT has formed higher highs, but its relative strength index (RSI) has formed lower highs since April 30. In other words, a bearish divergence that suggests PEPE's upside momentum will likely weaken in the short term.

In addition, PEPE appears on the road to its 50-4H exponential moving average (50-4H EMA; the red wave) near $0.0000047410, down 20% from current price levels.

A further break below the red wave could have the token test the $0.00000020-0.00000017 range as the next downside target.

Of course, the PEPE token is new and thus lacks adequate price history to anticipate its future price movements. Moreover, meme-coins are notorious for their sharp volatility and major price moves.

Dogecoin, for instance, has rallied 7,000% since 2020 thanks to vocal support from billionaire investor Elon Musk.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Beware of Bing AI chat and ChatGPT pump-and-dump tokens — Watch The Market Report live

February 21, 2023 Coin Telegraph

Coin Telegraph

On this week’s episode of The Market Report, Cointelegraph’s resident experts discuss ChatGPT pump-and-dump tokens and why you should be cautious.

This week on The Market Report, the resident experts at Cointelegraph discuss dozens of pump-and-dump tokens purporting to be related to ChatGPT and Bing AI chat.

We will be doing things a little differently this week since our handsome and charming host, Joe Hall, will be somewhere over the Atlantic during the livestream and will not be able to join us. Not to worry, though, as our resident experts Marcel Pechman and Sam Bourgi are here, as always, to break down the latest news in the markets.

Bitcoin bulls ignore recent regulatory FUD by aiming to flip $25K to support

The New York State Department of Financial Services ordered Paxos to “cease minting” the Paxos-issued Binance USD (BUSD) dollar-pegged stablecoin. On Feb. 16, a bank account controlled by Binance.US moved over $400 million to the trading firm Merit Peak, which is supposedly an independent entity also controlled by Binance CEO Changpeng Zhao. This and other bad news in the crypto market have not seemed to deter Bitcoin (BTC) from gaining 15% since Feb. 13. In fact, both retail and pro traders are showing signs of confidence. We explain why that is the case and why the odds favor a continuation of the current rally.

BingChatGPT ‘pump-and-dump’ tokens emerging by the dozen: PeckShield

Blockchain security firm PeckShield has raised the alarm after finding dozens of tokens purporting to be related to artificial intelligence (AI) powered chatbot ChatGPT. Some of these tokens have already lost most of their value, if not all, in what is often referred to as a “pump-and-dump” scheme or a “rug pull.” A pump-and-dump scheme typically involves the creators orchestrating a campaign of misleading statements and hype to persuade investors into purchasing tokens, then secretly selling their stake in the scheme when prices go up. You might think it interesting to check out a token supposedly related to the recent hype involving Bing AI chat and ChatGPT, but we’re here to tell you to be cautious when getting financially involved with any of them. We also explain some basic ways you can keep yourself safe from such scams.

Bitcoin active addresses ‘concern’ analyst despite 50% BTC price gains

Bitcoin still lacks the on-chain volume and active address increases that characterize bull markets, research warns. In a frank appraisal of the 2023 BTC price rebound, on-chain analytics platform CryptoQuant warned that Bitcoin might be weaker than it seems. Many analysts seem to be very suspicious about the recent bullish trend in the market, and we’re here to explain why.

Our experts cover these and other developing stories, so make sure you tune in to stay up-to-date on the latest in the world of crypto.

Do you have a question about a coin or topic not covered here? Don’t worry — join the YouTube chat room and write your questions there. The person with the most interesting comment or question will have a chance to win a one-month subscription to Markets Pro worth $100.

The Market Report streams live every Tuesday at 12:00 pm ET (5:00 pm UTC), so be sure to head on over to the Cointelegraph Markets & Research YouTube page and smash those Like and Subscribe buttons for all our future videos and updates.

BingChatGPT ‘pump and dump’ tokens emerging by the dozen: PeckShield

February 21, 2023 Coin Telegraph

AI Chatbots

Blockchain security firm PeckShield on Twitter said it has found dozens of pump-and-dump tokens purporting to be related to ChatGPT.

Blockchain security firm PeckShield has raised the alarm after finding dozens of tokens purporting to be related to artificial intelligence (AI) powered chatbot ChatGPT.

“In a Feb. 20 post, the firm revealed at least three "BingChatGPT” tokens appear to be part of honeypot schemes — a smart contract that tricks a user into sending Ether (ETH), which the attacker then traps and retrieves.

*Some of the addresses reportedly associated with the BingChatGPT tokens. Source: PeckShield*

According to PeckShield, at least two of the tokens identified have already lost nearly 100% of their value, while a third is at a 65% loss — in what is often referred to as a “pump and dump” scheme or “rug pull.”

A pump-and-dump scheme typically involves the creators orchestrating a campaign of misleading statements and hype to persuade investors into purchasing tokens, then secretly selling their stake in the scheme when prices go up.

At least one of the bad actors behind the tokens, “Deployer 0xb583,” is responsible for creating “dozens of tokens with a pump & dump scheme,” said PeckShield.

#PeckShieldAlert PeckShield has detected dozens of newly created #BingChatGPT tokens, of which 3 appear to be #honeypots & 2 have high sell tax. 2 of them have already dropped over -99%.
Deployer 0xb583 has already created dozens of tokens with a pump & dump scheme #AI #ChatGPT pic.twitter.com/merQikuslk
— PeckShieldAlert (@PeckShieldAlert) February 20, 2023

While PeckShield did not explain why the bad actors are using the name BingChatGPT for their tokens, the scammers could be trying to take advantage of the Feb. 7 announcement that OpenAI’s ChatGPT tech is being integrated into Bing and Microsoft’s Edge web browser.

The token’s name might be an attempt to trick victims into thinking they are somehow related to Microsoft and take advantage of the hype around AI chatbots.

Blockchain analytics firm Chainalysis recently noted in a Feb. 16 report that nearly 10,000 new tokens launched in 2022 had all the on-chain characteristics of being pump-and-dump schemes.

According to the Blockchain analytics firm, 1.1 million tokens were launched last year, but only 40,521 had an “impact on the crypto ecosystem,”with at least ten swaps over four consecutive days of trading in the week following their launch.

*An example of a crypto pump and dump scheme. Source: Chainalysis*

"Of the 40,521 tokens launched in 2022 that gained sufficient traction to be worth analyzing, 9,902, or 24%, saw a price decline in the first week indicative of possible pump and dump activity," the firm said.

While a price drop on its own is not an indication of wrongdoing on the part of token creators, the firm noted that it examined 25 in particular and found “they were almost certainly designed for a pump and dump,” with malicious honeypot code that prevents new buyers from selling the token.

Wash trading will cause crypto’s next implosion: Mark Cuban

January 6, 2023 Coin Telegraph

Coin Telegraph

The majority of centralized exchange volume is fake, according to the billionaire investor and Dallas Mavericks owner.

Crypto token wash trading on centralized exchanges will be the cause of the next crypto “implosion,” according to billionaire Dallas Mavericks owner and crypto investor Mark Cuban.

In an interview with The Street on Jan. 5, the billionaire investor opined that 2023 will not be short of crypto scandals following the numerous fiascos that rocked 2022.

Cuban, who has backed several crypto and Web3 startups, said he believes the next biggest thing to impact the industry will be "the discovery and removal of wash trades on central exchanges.”

“There are supposedly tens of millions of dollars in trades and liquidity for tokens that have very little utilization,” he said before adding, “I don't see how they can be that liquid.”

*Mark Cuban . Source: American Broadcasting Company website*

Wash trading, which is illegal under U.S. law, is a process whereby a trader or bot buys and sells the same crypto asset to feed misleading information to the market.

The goal is to artificially inflate volumes so that retail traders jump on the bandwagon and push prices up. In essence, it is a pump-and-dump scheme.

Cuban said it was just a prediction, adding “I don't have any specifics to offer to support my guess.”

As much as 70% of the volume on unregulated exchanges is wash trading according to a December report by the National Bureau of Economic Research (NBER).

Researchers used statistical and behavioral patterns to determine which transactions were legitimate and which ones were spurious.

Furthermore, a 2022 study by Forbes on 157 centralized exchanges found that more than half the Bitcoin trade volumes were fake.

Wash trading isn’t just limited to centralized exchanges, however. On Jan. 5, Quantum Economics CEO and former eToro senior market analyst, Mati Greenspan, said that 42% of all NFT volume is wash traded.

Yeah. It's 2023 and we're still talking about wash trading. https://t.co/y9kiLbu4Eu
— Mati Greenspan (@MatiGreenspan) January 5, 2023

He added that wash trading is also used to harvest tax losses, making it appear (to the taxman) that there has been a greater loss than in reality.

Billionaire Bill Ackman: Crypto Enables Creation of Useful Businesses and ‘Is Here to Stay’

November 22, 2022 Bitcoin.com

Serum price soars 140% in one week amid FTX ‘exit pump’ fears

November 21, 2022 Coin Telegraph

Binance

FTX exposure risk has not stopped Serum price from a massive rally despite major cryptocurrency exchanges delisting SRM.

Serum, a "decentralized exchange" on the Solana blockchain, has performed exceptionally well in terms of its SRM token price, despite it ties to the defunct FTX exchange.

SRM price up 140% in one week

On the daily chart, the SRM/USD pair has gained 140% in the last seven days, hitting $0.319 on Nov. 21 versus $0.177 on Nov. 14.

This pushed the circulating market cap to about $73 million and "fully diluted market cap," the market cap if the maximum supply was in circulation, to nearly $2.8 billion.

*SRM/USD daily price chart. Source: TradingView*

"Closer to zero"

SRM price rallied despite the ongoing delisting of Serum trading pairs across major cryptocurrency exchanges, including Binance, OKEx, Gate.io, and Phemex, thus raising fears about an ongoing "exit pump."

Exit pumps are when large investors pump the token's price in a low-liquidity environment to attract new buyers, only to then dump their entire holdings on amateur investors as witnessed with numerous pump-and-dump schemes.

Hahah. This pump here, is meant to trap anybody in a position on kucoin $SRM because it’s getting delisted TOMORROW. Maybe now. pic.twitter.com/fVVYumSkNA
— IcZ 64 ♣️Geиo Analysis ♠️ (@IcZeno) November 15, 2022

Distrust in Serum has grown due to its troubling exposure to FTX. In a Nov. 11 bankruptcy filing, a leaked balance sheet revealed that FTX had $8 billion in liabilities against a reserve mostly comprised of illiquid assets, including SRM.

Notably, FTX showed about $5.4 billion worth of SRM tokens in its reserves, or almost 97% of Serum's total market cap, including the circulating and fully-diluted supply.

As a result, the token's exposure to FTX has raised the possibility of a major selloff.

"If FTX had attempted to sell them into the market over the course of a week or month or year, it would have swamped the market and crashed the price," noted Matt Levine, Bloomberg's Opinion Columnist, adding:

"Perhaps it could have gotten a few hundred million dollars for them. But I think a realistic valuation of that huge stash of Serum would be closer to zero. That is not a comment on Serum; it’s a comment on the size of the stash."

Serum community forks to cut ties with FTX

The SRM price rally in the past seven days coincided with efforts to distance Serum from FTX.

Serum's key backers threw their weight behind an emergency "community fork" after wallets associated with FTX saw suspicious outflows worth $266.3 million on Nov. 11.

Brain Long, one of the popular validators on Solana, noted that the fork had renewed the market's sentiment in SRM.

Open Source + Order Book = Open Book. The name also suggests transparency.

Post other ideas below. Also, post some #BadNamesOnly for humor. ;-)
— Brian Long | Block Logic | Triton One ☀️ (@brianlong) November 15, 2022

Still, Serum's fork has failed to attract fresh capital toward its liquidity pools. As of Nov. 21, the total-value-locked inside Serum's reserves was a mere 33,900 SOL compared to 3.3 million SOL at the start of the month.

*Serum total-value-locked as of Nov. 21. Source: Defi Llama*

Serum price collapse ahead?

From a technical perspective, SRM stares at the possibility of undergoing massive selloffs in the coming weeks.

The bearish argument stems from a descending triangle setup on its daily chart, which suggests more declines ahead if coupled with the previous SRM price downtrend. Descending Triangle patterns are trend continuation setups.

Hence, SRM now eyes a potential breakdown below the triangle's lower trendline near $0.234. A successful break below the said support would risk sending the price toward the level at length equal to the maximum distance between the triangle's upper and lower trendline.

In other words, SRM price risks crashing to $0.10, or by 65%, by December 2022.

Conversely, a breakout above the triangle's upper trendline near $0.30 could have the token test its 50-day exponential moving average (50-day EMA; the red wave) at $0.56 as its next key upside target.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Retail interest falls

PEPE whale distribution is worrisome

20% PEPE correction ahead?

SRM price up 140% in one week

"Closer to zero"

Serum community forks to cut ties with FTX

Serum price collapse ahead?

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