
“Pump-and-Dump” schemes in Telegram groups drive penny crypto coin prices up - baxtr
https://www.achtungtechnik.de/english/2018-crypto-pump-n-dump-telegram.html
======
wintom
The real issue with all the pump and dump, fear of missing out, and all the
other crazy “mooning” is that it is ruining this whole space. It is creating a
reality that all the haters of cryptocurrency have been talking about for a
while.

Instead of focusing on building real applications with blockchain,
programmable money, and changing the world everyone is focused on trading and
get rich quick schemes. This stuff could change the world it is money ripped
out of government hands and it could be baked into everything we do on the
internet but I am not so sure that will happen anytime soon anymore.

I am very jaded with the whole space because of all this fraud.

~~~
malmsteen
There's no "application" of blockchain. You'd be rather thanking thoses
schemes because they are feeding the hype of what would be seems as a useless
techno otherwise.

I mean come on, anything can be done without it and using blockchain just
bring unessential minor improvements like decentralization that no one cares
about. Prove me wrong ...

~~~
adamnemecek
It allows you to opt out of the monetary system that's been imposed on you by
your govt. This might be less of a big deal if you live in a developed country
but it's a big deal if you live in an unstable country.

~~~
bradleyjg
Why not just hold most of your savings in dollars, euros, swiss franks, or
whatever? Doesn't that just as effectively opt you opt?

~~~
adamnemecek
Let’s say you have to leave the country with all your saving. I’d much more
comfortable carrying it in btc than cash.

~~~
bradleyjg
You don't need to hold physical cash to hold USD. You could have a bank
account in London, Geneva, Paris, or New York with your pounds, franks, euros,
or dollars. If you need to leave the country, your savings are already outside
of it. Just like your bitcoins.

The answer seems to be that repressive countries haven't yet put in place
effective mechanisms to be repressive with respect to bitcoins. But there's
zero reason intrinsic to bitcoin to expect that to continue. On the contrary,
since everything is digital the choke points are easier to control, not
harder.

~~~
lixtra
Good luck opening a bank account in Geneva as a US citizen. Unless you bring
really a lot of cash they won't touch you with a 5 ft pole.

~~~
bradleyjg
If you consider the US an unstable country, I don't know what to tell you.

~~~
adamnemecek
Not what he’s saying. You can’t open an account even if you are from the us,
much less so Iran.

~~~
bradleyjg
"Much less from Iran" misunderstands the problem with opening an account from
the US. Swiss banks don't want to subject themselves to the long reach of the
United States government's aggressive criminal justice system. That's the
reason they won't open a bank account for a US system anymore. See, e.g.
[https://www.swissinfo.ch/eng/tax-evasion_us-programme-
nets--...](https://www.swissinfo.ch/eng/tax-evasion_us-programme-nets--
1-billion-from-swiss-bank-fines/41858248)

The reason it was impossible, until recently, for an Iranian to open a bank
account in Switzerland was not because of the Iranian governments, it was
because the Swiss bank was afraid of running afoul of the US sanctions regime.
Because those sanction have been lifted (at least for now) an Iranian _can_
open a bank account in Europe, albeit they'll still have to go through a
fairly extensive KYC process.

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avenoir
Just a week ago I saw a guy pump and dump a random altcoin live on Twitter
just to prove his "haters" that he doesn't leave his followers holding a bag
when he does his scheduled PnDs. The level of arrogance is really astounding.
Hell, all of the biggest bitconnect scammers with a following on YouTube have
already moved on to shilling other lending platforms instead of just
disappearing. Interesting to see this unravel and how long it can continue.

------
jraines
It's only legal if you wear a suit and do it on CNBC. This is my expert
opinion as a super lawyer.

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adamnemecek
Can anyone recommend any good books on things like this? Idk what "this"
really is lol. Black hat economics?

I’ve setup a slack channel for crypto discussion because most groups and
subreddits are too shilly and memey.
[https://hncrypto.slack.com/join/shared_invite/enQtMjk5MDg2Mz...](https://hncrypto.slack.com/join/shared_invite/enQtMjk5MDg2MzAzMTIwLTEzNmU2NzVlNWFkMjNmZDI1ZGU1NzQ3MTZmNzM0NDU2OTc0Y2Y2NWMxZjBkZmI1MzMxMDllOGIzOTgwYWQ4MmU)

~~~
qznc
Here is a draft of a book:
[https://cryptofrenzy.wordpress.com/2014/02/19/wolong-
writes-...](https://cryptofrenzy.wordpress.com/2014/02/19/wolong-writes-a-
book/)

The author is allegedly the guy behind the Dogecoin pump 2013.

~~~
samsonradu
Dogecoin actually managed to pull a pump-dump-pump? Its valuation looks quite
good as we speak, even though I remember the dump (2015) [1]

[https://motherboard.vice.com/en_us/article/78xqxb/the-guy-
wh...](https://motherboard.vice.com/en_us/article/78xqxb/the-guy-who-ruined-
dogecoin)

------
kjullien
I don't think that this actually has any mid/long (even short depending on how
you define that) lasting impact on the market. If you watch any pump and dump
charts no matter how big the group is, you see that the price is exactly the
same as before mere minutes after their little schemes... The only people who
make money off of this are the ones that organize it and buy way before
everyone else, or maybe a lucky few very fast buyers, but that's pretty much
it. I'm pretty sure even people who try this don't do it more than once.

------
samstave
Didn’t the Winklevoss twins of Facebook fame buy like 20% of all bitcoin some
time ago?

What is their worth now?

[https://www.google.com/amp/s/amp.businessinsider.com/bitcoin...](https://www.google.com/amp/s/amp.businessinsider.com/bitcoin-
billionaires-winklevoss-twins-2017-12)

------
NicoJuicy
Crypto seems to be a perfect example what I think big banks are doing in a
"regulated space", eg. Downgrading all currencies except dollar, earning money
on top of big clients ( pump scheme,... ) And etc..

It's just less obvious

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milofeynman
What other kinds of fraud that has occurred in the past (stock market, real
estate, etc) are people going to try with crypto? So far we've seen some big
ones (pump-and-dump, and pyramid scheme).

~~~
buttcoinslol
Wash trading: [https://medium.com/@bitfinexed/wash-trading-bitcoin-how-
bitf...](https://medium.com/@bitfinexed/wash-trading-bitcoin-how-bitfinex-
benefits-from-fraudulent-trading-8bd66be73215)

Allegedly unbacked reserve currencies (tether):
[https://www.coindesk.com/tether-confirms-relationship-
audito...](https://www.coindesk.com/tether-confirms-relationship-auditor-
dissolved/)

I'm sure there are more, any scheme/scam that gives someone an edge _will_ be
tried in an unregulated market.

------
lixtra
Would this go away with more regulation? Is it fraud?

~~~
pcwalton
Pump and dump is absolutely fraud (as it requires deception to work--note the
"promote on social media" step), and you can go to prison for it. Jordan
Belfort, the "Wolf of Wall Street" mentioned in the title, did.

~~~
spunker540
I think if these were regulated securities being traded on regulated exchanges
it certainly would be fraud and a jailable offense. But is it fraud for
something like collectible beanie babies? (as far as I can tell that is
basically how cryptocurrencies are regulated right now in the US).

~~~
pcwalton
If you make money by getting groups together to sell Beanie Babies falsely
claiming that you have insider info that the fad is going to make a comeback,
that is fraud, and you can go to prison for it.

~~~
jakear
How does this translate over to things like fashion/social trends in general?

Something like "Corsets are coming back for spring 2018! Get on top of the
trend at XYZ Fash Inc.!" hardly seems like fraud, but by that definition it
would be.

~~~
pcwalton
This is where a lawyer would have to answer. I'm certain that a detailed
explanation would involve a mountain of cases and precedents. (I would guess
that a lot of the precedent hinges on whether you are intentionally lying, or
whether you are merely making a good-faith prediction. Pump-and-dump schemes
are obviously the former.)

The point is that, in general, deception for financial gain is fraud, more or
less by definition. It doesn't have to involve regulated securities.

------
KasianFranks
Just like stocks
[http://investorshub.advfn.com](http://investorshub.advfn.com)

------
Simon_says
"You can't con an honest man."

~~~
Retra
You're not saying very much here, but...

If you're someone looking to get rich investing in cryptocurrency, it's worth
considering where the money (not the 'value') actually comes from. People have
to spend it, and you have to take it. If you don't care where it comes from,
you may as well be stealing it.

~~~
Simon_says
> If you're someone looking to get rich investing in cryptocurrency

I'm not. I'm really really not.

~~~
Retra
I wasn't referring to you specifically.

