RE: Why Bancor Will Probably Be A Pump-And-Dump Nightmare for Investors, Unless it Changes
OK. I am confused what your point is here. I initially thought it was something else. I am just going to take your words literally (which isn't always accurate). Feel free to correct my interpretation.
Yes, pump and dumps will always be possible, the problem is that with Bancor they are easier to do and less risky to do, so more scammers will do them. I explain this in the article. I am glad Bancor is looking for solutions to sudden explosions in value that are often shady in nature. Good for Bancor.
With a Bancor backed coin you can pump by buying the contract. The price naturally goes up the more you buy. You don't need fake parties to pump. You could use them though. I don't see what prevents this, but it isn't necessary because of Bancor's pricing mechanism. EDIT: I guess savvy investors could identify trading between fake parties more easily because of the spread between the coin's trading value and its contract value. That is a good feature, but again, pumpers don't need to trade between fake parties to increase the cost of the coin.
Your final point I don't understand and I ask you to clarify it. Is the scenario you are proposing one where a whale buys all the available coins or one where he sells all his coins back to the contract? If it is the former, then the price would go up (way up) and the pumper profits. If it is the later, I covered that in my article (second to last paragraph).
It is possible for a pumper to lose money if he is found out and the current coin holders sell their coins for the reserve currency. However, the pumper's position still isn't a total loss like he risks in non-reserve backed coins, so I don't see how that is more risky at all. It certainly could be sudden though.
Also, this is something I should have mentioned in the article and might add later, in the scenario where the pumper is found out and dumped on by whales currently holding the coin, all other coin holders are hurt too. So it isn't a good scenario for anyone but the whales (who presumably made money on the dump). It isn't good when the one avenue that screws pumpers also screws everyone else.