WSJ Reports Crypto-Market Manipulation Worth $825M in 2018
According to the Wall Street Journal, organized “trading groups” are majorly responsible for the spike in price manipulation related to digital currencies. After publishing the results of their report, the publication proposed that the act of pumping crypto within markets followed by dumping them was a method that several individuals used to raise the price several coins before plummeting them again.
Through this method, several groups are producing hundreds of millions of USD in personal gain as the remainder suffer heavy losses after a certain group decides to completely sell every unit of a specific asset in massive quantities. According to the report, within Q1 and Q2 of this year alone, these traders were responsible for a collected gathering of $825M in profit.
The Journal then examined 175 different malicious trading operations utilizing around 121 cryptocurrencies and said that many more similar trading groups were currently operating and may possibly be contributed to even more massive funds just through activity. It goes on to state that these groups are communicating and conducting business within private messenger groups and rooms through an invite-only procedure typically monitored by an unidentified admin.
The WSJ then presented Cloakcoin as a prime example of the current malicious inflations and how they operate, explaining that the senior alternative coin was exposed to many pumps this year alone. Binance was also exposed to a massive spike in growth last month and the event was claimed by another one of these trading groups operating under the name Big Pump Signal. The report claims that the group spread the news through their private groups and chat rooms and urged their followers to quickly purchase the tokens and resulted in the boost in price.
Many have attributed Bitcoin, the world’s first and leading cryptocurrency, and its all-time high of $20K, as a result of liquidation sales by Mt.Gox and other factors consistently responsible for fluctuations although others have also stated that these events have not affected markets in any way.