Pump and dump

A pump and dump is a scheme known from financial markets long before crypto. A group buys a cheap, illiquid token and then promotes it heavily: KOL posts, Telegram messages, promises of a major exchange listing or a partnership. The price rises, new buyers pile in on FOMO and the organisers sell them their tokens. After the selling the price falls, often below where it started.

In memecoins the line between ordinary hype and a pump and dump can be thin, because every token lives on attention. The warning sign is coordination: many accounts posting similar messages at the same time, while wallets that bought before the promotion sell during the rise.