How to Identify Pump & Dump Schemes

Pump and dumps are manipulative schemes that trap unsuspecting traders.

Warning Signs

Pre-Pump Indicators

• Sudden social media hype
• Coordinated shilling
• Low volume before spike
• New accounts promoting

The Pump Phase

• Rapid price increase
• FOMO inducing candles
• Viral marketing
• "Guaranteed" profit claims

The Dump

• Early buyers selling
• Price collapses
• Late buyers left holding
• Liquidity dries up

How to Protect Yourself

Research: Check token distribution, team, utility

Volume Analysis: Unusual volume spikes without news

Social Media: Coordinated promotion patterns

Avoid FOMO: If it's pumping, you've likely missed it

Red Flags

• Guaranteed returns promises
• Celebrity endorsements
• Limited time pressure
• Anonymous teams
• No real utility