cryptocurrency pump
How to Make a Profit on the Cryptocurrency Pump

When starting to work within the cryptocurrency market, the ordinary investor hears about Pump & Dump schemes, which is when large players drive small ones off the market. But huge earnings on the cryptocurrency pump attract many inexperienced investors.  Is it for real? How much should you invest in a cryptocurrency pump and what profit can you expect? Let’s check it out!

A cryptocurrency pump is the first phase of a cryptocurrency pump and dump scheme, during which the cryptocurrency price is sharply increased. Pumpers artificially “pump” the price of the selected cryptocurrency in order to sell their assets in future. To do this, they create an artificial excitement around the coin.

The more investors believe in the success of the cryptocurrency and buy “growing” coins, the higher their price rises. And the more will be the profit of the pumpers, who will start the drain at the right moment.

Theoretically, any cryptocurrency can be pumped. But it is very difficult to artificially pump up bitcoin and top altcoins. To provoke the necessary jump in the course, it is necessary to invest at least several million dollars into the purchase of coins.

Pumping is carried out on cryptocurrency exchanges. A huge number of users, a large selection of trading pairs and the presence of a large number of new cryptocurrencies have made the exchanges a very convenient platform for pumpers. But some exchanges (for example, Bittrex) consider the cryptocurrency pump and dump illegal and work against Pump & Dump schemes.

Therefore, investors choose less popular cryptocurrencies for pumping. Ideally, they should meet the following characteristics:

  • Low market capitalization
  • A long period of low market value (flat)
  • The presence of a promising technology, which can be appealed to create an agiotage
  • Positive or neutral reputation in the market (no scandals associated with developers, serious hacking and so on)

How to Become an Organizer of a Cryptocurrency Pump?

The most obvious and profitable way to make money on pumping is to lead it. According to experts, with the growth rate of “inflated” cryptocurrency only 40-50%, the net profit of the cryptocurrency pump organizer is 10%.

The person who decides to organize pumping has two main ways:

  • Pump off the cryptocurrency alone
  • Create a pump group

The first option is only suitable for those sharks of the cryptocurrency world who can afford to pour a few dozens or even hundreds of thousands of dollars into the right coin. According to experts, the minimum entry threshold for single pumping for non top-level cryptocurrency is $15,000.

The second option is less expensive but more labor-intensive in terms of organization and has several variations:

1. Several experienced traders (3-4 or more) combine to pump the chosen cryptocurrency together. Most often, they find each other on thematic forums and websites. And then they agree on the time, place and duration of the pump, pump the coin, and merge their assets at a peak price.

2. One or more organizers create a cryptocurrency pumping group on the web. Their main task is to attract as many participants as possible who will be able to give signals to the mass purchase of the cryptocurrency. Whatever it is, the organization of pumping requires serious investments that the average investor cannot afford.

cryptocurrency pump

How Can an Ordinary Investor Make a Profit on the Cryptocurrency Pump?

Here, there are several options for earning. An investor can join a pumping group or enter the pump alone. Let’s consider both scenarios:

  • Participation in a pumping group
  • There are many such communities today (for example, cryptocurrency pump Telegram groups)
  • Self-entrance to a crypto pump

Large-scale pumping never begins just like that. It is preceded by concrete signals:

  • Mass public relations of previously little-known cryptocurrency
  • Distribution of resonant insides
  • Creating a hype among traders

Read also: 

5 Easy Ways to Earn Bitcoin and other Cryptocurrencies

It can be difficult to notice and react to these cryptocurrency pump signals on time. To do this, we would have to constantly monitor the market charts of many cryptocurrencies. But there are some alternatives:

  • Subscribe to the channels of pumping communities.
  • Monitor the cryptocurrency pumping using special monitoring services. For example, CoinData.
  • Create pending orders with a cryptocurrency pump alert

As we can see, today there are two main components of successful earnings on a cryptocurrency pump – the availability of reliable signals about Pump & Dump and the ability to analyze the current situation in the market.

Therefore, pumping is not suitable and very dangerous for beginners, who have never worked with cryptocurrencies before. This is a risky way to earn money, which can bring profits to experienced traders only. But even such traders act as carefully as possible.