Скачать или смотреть (Episode 2) The path of honor won`t be easy

What do you think when a crypto price surges and falls almost immediately? Only sometimes is it a result of regular market volatility. Often market manipulators cause a sudden rise and fall in market prices to defraud you. These bad actors go to any extent and use different tricks to achieve their aim, putting you in a bad market position.

What Is Crypto Market Manipulation?
A deliberate attempt to influence the value of assets and interrupt a crypto market trend is known as crypto market manipulation.
In crypto manipulation, bad actors create illusions to inflate or deflate the market prices to snatch up profits. For example, they could spread fake news, run a series of pressuring tweets, create fake orders, release false market signals, speak negatively about an asset to induce fear in traders, etc. Hence, you must know how to spot and combat those manipulative tricks, which you will discover as you proceed.

Market manipulation has caused a lot of harm to crypto investors and the crypto market at large. It makes the market unnecessarily volatile and unsafe for investors, an issue that has made many traders and investors lose their trust in crypto.

1. Pump and Dump
Pump and dump is one of the most frequently used market manipulation strategies. It occurs when an individual or a group of people conspire to inflate the price of a crypto asset. The price inflation creates noise and attracts people to buy the asset. The bad actors then withdraw their funds sharply to make quick profits. The withdrawal deflates the price sharply and leads to sudden losses for many that were deceived. The major targets for pump and dump are cryptos with low trading volume.

2. Spoofing
Crypto whale spoofing involves manipulating the crypto market by initiating fake orders. This method involves placing large buy or sell orders intended to be canceled. Spoofing makes the market look favorable for trade, and as soon as retail traders send their orders and the market goes in their desired direction, they withdraw their profit. Spoofers try to sow fear, uncertainty, and doubt (FUD) to make you trade in their favor. Another way they can do this is to try to influence people’s decisions and market sentiments through various seemingly unrelated social media posts. Spoofing was a constant issue during the early days of Bitcoin, and it is still common in less-regulated exchanges.

3. Wash Trading
Wash trading is when a group of traders rapidly buy and sell crypto to generate high trade volumes. This act is carried out to attract traders and help such an asset gain attention. The multiple entries feed the market with misleading signals that distort an asset’s value and further lure investors to trade based on the false signal.Wash traders need multiple accounts to carry out market manipulation. They sell crypto with an account and buy it with another account. Hence, wash traders trade with themselves. This act is possible with unpopular crypto and smaller exchanges with low liquidity and trade volume since their trading activities are not so much. Wash trading can help them boost trade volumes and earn more commissions.

4. Stop Hunting
Stop hunting is an attempt to force traders out of their trade positions. The action can drag an asset below the price where traders have placed many stop-loss orders. Bad actors initiate multiple sell orders to make a crypto price decline and hit the stops. This results in high crypto volatility and gives the attackers a chance to buy at a lower price.
Stop hunting is a strategy financial institutions and market-makers use to make short-term profits. Once they discover a cluster of stop-loss orders around the same price, they’ll force the market through the orders and displace traders from their positions.
You Cannot Totally Avoid Price Manipulation
Not all sudden and major market price swings result from price manipulation. The market is generally volatile, and a lot happens every minute. So make sure you always trade with a solid trading plan and implement various risk management strategies.

The crypto market is still young and widely unregulated. As a result, as new cryptocurrencies get introduced, they are usually pushed by market hype, while some developers also try different ethical and unethical methods to popularize their coins.

When trying to trade and invest in cryptocurrencies, prioritize and stick to your analysis and trading strategies—don’t follow market noise. It is better to stay out of the market than to try to trade a hyped and noisy market consistently.