How Crypto Prices Are Manipulated?

You might wonder why prices of some coins go high in a few hours and afterwards crash hard. If you try to analyze and follow up the market carefully,you will find out that, Someone somewhere might be manipulating the market prices to their own advantage.

However, according to the investigations conducted by some regulators, they have found that, cryptocurrencies with a low Market Cap( i.e of less than $5million Total Vol) are easy to manipulate to make their prices rise to almost 10x.

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How are the Markets manipulated?
Lets look at the ways in which the crypto market is manipulated;

Pump and Dump
This is when a group of investors inflate the price of a particular coin just to trick people into buying it at a higher price.
With Pump and Dump, investors select a cryptocurrency with a low market cap and buy a large portion of its funds on several exchange platforms. Then they will promote that cryptocurrency on many communication platforms such as Telegram, Reddit so that people jump into buying it. Most of the messages passed on are in most times false. Their motive is to convince people to buy the coin so that they can sell at a high price. Since the crypto manipulated has a low value and a light volume, this brings excitement in the public thereafter price starts to rise up. Once the valuation reaches the target, these manipulators start selling the crypto at a higher price to the people who are willing to hold.
That's how sometimes we are affected with our investments which turnout to be worthless.

In my next post, i write about how crypto exchange platforms and bots manipulate the market.

Thanks for reading.
@timothy256