Using a new deceptive tactic, scammers can easily trick experienced traders and rake in 5-6 figures daily.
**Memecoins** have skyrocketed in popularity in recent years, becoming a major part of the crypto scene. Many people are choosing meme coins over fundamental tokens, as they offer the possibility of becoming a millionaire overnight. However, with this rising popularity comes an increase in scams and malicious actors.
Memecoins have always been a high-risk, high-reward market, but with the surge in scams, itâs now riskier than ever. Scammers are constantly developing new hidden tactics, and even seasoned traders can fall victim.
Here's how you can avoid their traps and improve your chances of finding a future 1000x gem:
**Finding New Meme Coins:**
- Most meme coin traders use tools like Dexscreener or DEXToolsApp to search for new tokens.
- Tokens with the highest trading volume naturally grab more attention, even if other metrics donât stand out.
**Checking the Metrics:**
- Experienced traders usually look at three key metrics: volume, market cap, and the number of holders.
- Market cap is often overlooked, as traders arenât afraid to buy unknown coins with low market caps, hoping to catch the next 100x.
- Eventually, they stumble upon a coin with decent volume and a reasonable number of holders. Sounds like a great deal, right?
**The Reality:**
- In fact, 9 out of 10 of these tokens are scams, and those impressive numbers are often fake.
- This tactic is called **wash trading**, designed to lure real traders and inflate the token's value.
- Wash trading is a form of market manipulation where scammers artificially pump trading volume.
- These bad actors are often the developers or fraudulent market makers.
**The Method:**
- Scammers use specialized automation software to buy the same token from thousands of wallets simultaneously.
- They also "bundle" transactions to purchase in the same block when the token launches.
- This enables them to "snipe" the launch and later sell for massive profits.
**Why It Works:**
- By artificially increasing the number of holders and using wash trading to attract real buyers, scammers can then sell at a huge profit.
- Platforms even exist that offer bundling and wash trading services, and itâs surprisingly affordable.
- For example, you can buy fake volume from 1,500 wallets for just 9 $SOL (about $1,200).
**Hard to Detect with Bubblemaps:**
- Since these wallets arenât connected, itâs nearly impossible to identify the scam using tools like Bubblemaps.
- These wallets often appear to be legitimate holders.
**How to Spot These Scams:**
- Minimal or no activity on social media, or suspiciously botted comments.
- Most buyers have no previous blockchain transactions.
- Numerous mirror trades with nearly identical amounts, placed one after the other (bundled transactions).
- The majority of buyers' wallets are funded from unknown CEXs or mixers on the same day the coin is launched, with their first transaction being that exact coin.
Memecoins are especially easy to manipulate during their early stages. It's crucial to recognize these manipulations and know when to take profits. Avoid getting caught in scams, and always do your own research (DYOR) before buying any token, especially meme coins.