Following the success of Reddit’s Wall Street Pumps manipulation of GameStop stock, a scammer took advantage of the name by creating a Telegram channel called “WallStreetBets – Pumps” and promoting it on the Reddit board.
Subsequently, nearly 100,000 people joined the channel that allows one way communication with the unknown channel owner.
Each week, the channel promotes a timed “pump” of a Crypto currency that is only unveiled at a set time.
Boasting of 500% gains, the scam attracts the trusting and naive that believe for the general goodwill of the public, a person is going to organize a large increase in an asset without taking advantage of the poor suckers who invest in it.
The last “pump” occurred on April 11th and after it was announced, the price of alt coin VIA, jumped by almost 160%.
Sounds like an opportunity, right?
Let me breakdown how it works.
The telegram channel owner initially starts buying the coin he was announcing the week of the pump.
Buying in small increments as to not be detected, he also places limit sell orders at increments based upon the project high limit of the pump – typically 150%.
At the time of the announcement, a trusting investor is supposed to buy immediately then wait for the price to climb and sell off.
Sounds easy right?
Wellll, not so much because the entire event is over within 45 seconds and by the time you buy, the scammer’s sell orders are already profiting off of the late purchase.
So for instance, if the price of a coin at the time of the announcement is $1, by the time you buy – even within five seconds, the price will shoot up to $1.50 and that’s your purchase price.
The get-rich-quick investor will sit and wait only to realize that within the next minute, their investment just dropped to under a dollar and they lost money.
That’s due to the scammer placing a large buy order just before the announcement, driving up the price and with no time to research the data of the coin, suckers fall for the scam and lose their cash.
At least one poor soul lost his life savings in the scam.
Thankfully, crypto currency is tracked on a public ledger and with some diligence, you can track down the transactions and ultimately the wallet ID’s of the scammer running the WallStreetBets – Pumps telegram channel.
So I did just that and reached out to the admin of the channel, calling out his scam.
I typed into my phone, “Been following your pumps and it’s a flat out scam. You buy in typically three days before the pump and then set your sell limits all over. No one can profit as it’s over in 45 seconds. But thankfully everything is on the blockchain, including your wallet ID’s.”
That got his attention as he responded, “ok and now? Tell me how I can help you.”
While I could exploit him for his next coin pick in advance, I didn’t because, well, I have ethics and won’t cooperate with some fucker that I would typically pound into a bloody pulp for stealing from people.
If you’re willing to put in the time, you can track down the wallet and see the coin buys in advance like I did. If you choose to profit, that’s your call. However you can also chose to put him out of business buy setting your own limit sells at miniscule increments in the thousands – a crypto trading bot can help with that.
If he has to go back to living in his mom’s basement, I don’t think anyone would shed a tear.
But for most of us, it’s best to simply to make sure your friends and family don’t fall for the scam.
As within anything in this world, there’s no fast way to lasting success. If you’re investing in crypto or anything else, put in the effort to research your choices before dropping cash on an opportunity.
If you fall for a shady little shit promising 500% returns, the only money being gained is by the scammer.