Pump, dump, and then what? The long-term impact of cryptocurrency pump-and-dump schemes

Joshua Clough; Matthew  Edwards

doi:10.48550/arXiv.2309.06608

Pump, dump, and then what? The long-term impact of cryptocurrency pump-and-dump schemes

Joshua Clough^*, Matthew Edwards

^*Corresponding author for this work

School of Computer Science

Research output: Chapter in Book/Report/Conference proceeding › Conference Contribution (Conference Proceeding)

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Abstract

The pump and dump scheme is a form of market manipulation attack in which coordinated actors drive up the price of an asset in order to sell at a higher price. Due in part to a lack of enforcement, these schemes are widespread within the cryptocurrency marketplace, but the negative impact of these events on the coins they target is not yet fully understood. Drawing upon a novel dataset of pump events extracted from Telegram channels, an order of magnitude larger than the nearest comparable dataset in the literature, we explore the differing tactics of pumping channels and the long-term impact of pump and dump schemes across 765 coins. We find that, despite a short-term positive impact in some cases, the long-term impact of pump and dump schemes on the targeted assets is negative, amounting to an average 30% relative drop in price a year after the pump event.

Original language	English
Title of host publication	2023 APWG Symposium on Electronic Crime Research (eCrime)
Publisher	Institute of Electrical and Electronics Engineers (IEEE)
Number of pages	16
ISBN (Electronic)	979-8-3503-6027-1
ISBN (Print)	979-8-3503-6028-8
DOIs	https://doi.org/10.48550/arXiv.2309.06608 https://doi.org/10.1109/eCrime61234.2023.10485505
Publication status	Published - 1 Apr 2024
Event	Symposium on Electronic Crime Research 2023 - Universidad Pompeu Fabra – Campus de la Ciutadella, Barcelona, Spain Duration: 15 Nov 2023 → 17 Nov 2023 https://apwg.org/event/ecrime2023/

Publication series

Name	eCrime Researchers Summit
Publisher	IEEE
ISSN (Print)	2159-1237
ISSN (Electronic)	2159-1245

Conference

Conference	Symposium on Electronic Crime Research 2023
Abbreviated title	eCrime 2023
Country/Territory	Spain
City	Barcelona
Period	15/11/23 → 17/11/23
Internet address	https://apwg.org/event/ecrime2023/

Structured keywords

Cyber Security

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Clough, J., & Edwards, M. (2024). Pump, dump, and then what? The long-term impact of cryptocurrency pump-and-dump schemes. In 2023 APWG Symposium on Electronic Crime Research (eCrime) Article 10485505 (eCrime Researchers Summit). Institute of Electrical and Electronics Engineers (IEEE). https://doi.org/10.48550/arXiv.2309.06608, https://doi.org/10.1109/eCrime61234.2023.10485505

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title = "Pump, dump, and then what? The long-term impact of cryptocurrency pump-and-dump schemes",

abstract = "The pump and dump scheme is a form of market manipulation attack in which coordinated actors drive up the price of an asset in order to sell at a higher price. Due in part to a lack of enforcement, these schemes are widespread within the cryptocurrency marketplace, but the negative impact of these events on the coins they target is not yet fully understood. Drawing upon a novel dataset of pump events extracted from Telegram channels, an order of magnitude larger than the nearest comparable dataset in the literature, we explore the differing tactics of pumping channels and the long-term impact of pump and dump schemes across 765 coins. We find that, despite a short-term positive impact in some cases, the long-term impact of pump and dump schemes on the targeted assets is negative, amounting to an average 30% relative drop in price a year after the pump event.",

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note = "Symposium on Electronic Crime Research 2023<br/>, eCrime 2023 ; Conference date: 15-11-2023 Through 17-11-2023",

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Clough, J & Edwards, M 2024, Pump, dump, and then what? The long-term impact of cryptocurrency pump-and-dump schemes. in 2023 APWG Symposium on Electronic Crime Research (eCrime)., 10485505, eCrime Researchers Summit, Institute of Electrical and Electronics Engineers (IEEE), Symposium on Electronic Crime Research 2023
, Barcelona, Spain, 15/11/23. https://doi.org/10.48550/arXiv.2309.06608, https://doi.org/10.1109/eCrime61234.2023.10485505

Pump, dump, and then what? The long-term impact of cryptocurrency pump-and-dump schemes. / Clough, Joshua; Edwards, Matthew .
2023 APWG Symposium on Electronic Crime Research (eCrime). Institute of Electrical and Electronics Engineers (IEEE), 2024. 10485505 (eCrime Researchers Summit).

Research output: Chapter in Book/Report/Conference proceeding › Conference Contribution (Conference Proceeding)

TY - GEN

T1 - Pump, dump, and then what? The long-term impact of cryptocurrency pump-and-dump schemes

AU - Clough, Joshua

AU - Edwards, Matthew

PY - 2024/4/1

Y1 - 2024/4/1

N2 - The pump and dump scheme is a form of market manipulation attack in which coordinated actors drive up the price of an asset in order to sell at a higher price. Due in part to a lack of enforcement, these schemes are widespread within the cryptocurrency marketplace, but the negative impact of these events on the coins they target is not yet fully understood. Drawing upon a novel dataset of pump events extracted from Telegram channels, an order of magnitude larger than the nearest comparable dataset in the literature, we explore the differing tactics of pumping channels and the long-term impact of pump and dump schemes across 765 coins. We find that, despite a short-term positive impact in some cases, the long-term impact of pump and dump schemes on the targeted assets is negative, amounting to an average 30% relative drop in price a year after the pump event.

AB - The pump and dump scheme is a form of market manipulation attack in which coordinated actors drive up the price of an asset in order to sell at a higher price. Due in part to a lack of enforcement, these schemes are widespread within the cryptocurrency marketplace, but the negative impact of these events on the coins they target is not yet fully understood. Drawing upon a novel dataset of pump events extracted from Telegram channels, an order of magnitude larger than the nearest comparable dataset in the literature, we explore the differing tactics of pumping channels and the long-term impact of pump and dump schemes across 765 coins. We find that, despite a short-term positive impact in some cases, the long-term impact of pump and dump schemes on the targeted assets is negative, amounting to an average 30% relative drop in price a year after the pump event.

UR - https://gitlab.com/bristol-university-work/crypto-pump-and-dump

U2 - 10.48550/arXiv.2309.06608

DO - 10.48550/arXiv.2309.06608

M3 - Conference Contribution (Conference Proceeding)

SN - 979-8-3503-6028-8

T3 - eCrime Researchers Summit

BT - 2023 APWG Symposium on Electronic Crime Research (eCrime)

PB - Institute of Electrical and Electronics Engineers (IEEE)

T2 - Symposium on Electronic Crime Research 2023<br/>

Y2 - 15 November 2023 through 17 November 2023

ER -

Pump, dump, and then what? The long-term impact of cryptocurrency pump-and-dump schemes

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