Have you ever run out of money because of FOMO? The price of token X went up high, then suddenly dropped to the seventh hell 😂
Crypto traders, especially small coin traders (low mcap) must be familiar with this term. Yep, pump and dump! For those of you who are still newbies or just want to dive into the world of crypto, please take a good look. The problem is, if you get caught in a pump and dump action, your snack money can be lost in an instant! Don't you want your money to run out because of this mod? Don't worry, I'll tell you how to avoid it so that your wallet stays safe!
What is Pump and Dump?
Just imagine, there is a group of evil people who are collecting a lot of money. They create a new crypto coin, then lie to people to buy it. When the price is really high, they immediately sell all their coins. Well, the ones who lose are the small investors who just bought at the top who become victims. It's really cruel, right?
Why Are New Investors in Crypto Easily Scammed?
The crypto world is like the Wild West of investing. Most people get into crypto to find wealth, and who doesn't want to get rich the easy way? With a small investment, you can make a ton of money (that's what you want, right 😂).
But, in reality, anyone can create a new coin (whether on the $BNB , $SOL , $SUI , etc.) network, then claim to have a cool project to find new investors (of course the developer and his cronies have bought it below). In fact, they just want to cheat! That's why we have to be extra careful if we want to invest in crypto.
Features of Pump and Dump that we must know:
New Coins That Suddenly Go Viral: If there is a new coin that is really popular on social media, and then its price suddenly increases drastically, it's better to be suspicious first.
Sweet Promises That Don't Make Sense: Be careful of projects that promise to be too good to be true. For example, claiming to turn your $1 into $100K but there is no evidence / clear progress.
Overly Enthusiastic Online Communities: If everyone in the community is buzzing about the same coin, it could be a Batman trap.
Trading Volume Increases Dramatically: Usually, before the price increases, the trading volume of the coin will increase dramatically. This is a sign that something is wrong.
Anonymous accounts that constantly promote: Be careful of accounts on social media that suddenly appear and continuously promote certain coins.
How to Avoid Pump and Dump?
Pay Attention to Top Traders: Pay attention to the list of top traders in the dapps you use, if there are 5 or maybe more people who buy with $0 but they sell the coin, you can track their wallet address (it is possible that it was sent by the developer or maybe another trader). But if >5 wallets like this, then the coin is in the red flag category
Don't FOMO: Fear of Missing Out (FOMO) often makes us rush into making investment decisions. Be patient, don't immediately buy just because everyone is talking about the coin.
Do thorough research: Before investing, make sure you have found out everything about the coin. Read the whitepaper, check the developer team, and find out about the projects they are working on. If it looks suspicious, it is better to look for another coin.
Watch for negative signals: If you start to feel suspicious about a coin, it's better to sell it. Don't be too affectionate with your money.
Don't Trust Easily: There are so many influencers who claim to be crypto experts. Don't immediately believe everything they say. Find out where the information comes from first.
Pay Attention to Trading Volume: If a coin’s trading volume suddenly spikes drastically, it could be a sign of a pump and dump. Be careful!
Investing According to Your Pocket: Don't let all your money run out just for crypto investment. Remember, investing is risky!
Use a Secure Crypto Wallet: Store your coins in a trusted crypto wallet that has good security.
Conclusion
The point is, crypto investment must be thorough and careful. Don't let us become victims of fraud. Stay alert and don't be easily tempted by the lure of quick profits.
