Pump and Dump Schemes Account for $7 Million Monthly Trading Volume

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Researchers at Imperial College London claim to have developed a model for a crypto “pump-and-dump” scam, making it possible to proactively detect them.

Jiahua Xu and Benjamin Livshits at Imperial College London were the prime researchers in this study. They utilized artificial intelligence (AI) and machine learning to analyze hundreds of crypto pump-and-dump schemes to figure out a way to spot them before they occur.

Pump and Dump schemes are an age-old devious investing ploy wherein investors purchase an asset in large swaths, pushing its price up, a “pump,” and then sell-off or “dump” the overpriced assets causing a massive fall in prices and losses to the rest of the market.

While cryptocurrency markets are currently in a rut, with some coins reaching new lows in the month of November, daily trade volume is currently $14.2 billion, according to CoinMarketCap. The pump and dump volume cited in the study only...

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