Technical Definition

Pump and dump

A pump and dump is a manipulation scheme in which promoters drive up an asset's price or demand and then sell into the artificially created buying activity.

By Crypto University EditorialLast updated October 20, 2026

Wash tradingExit scamFOMO

✦ Key Insight

Thinly traded crypto assets can be especially vulnerable to coordinated manipulation.

✕ Common Misconceptions

Claims of guaranteed pumps, secret insider targets or fixed returns are major warning signs.

Detailed Explanation

Promoters may use misleading claims, coordinated buying, social media or private groups to attract new buyers. Insiders then sell their holdings, often leaving later participants with sharp losses.

In Practice

“A group announces a "guaranteed" token pump after insiders purchased earlier and then immediately sell into participants' orders.”

Dig Deeper

FOMO

FOMO means fear of missing out and describes the urge to act because others appear to be profiting or participating.

Exit scam

An exit scam occurs when operators take users' money or assets and disappear, abandon promised obligations, or deliberately prevent users from recovering funds.

Wash trading

Wash trading involves transactions arranged to create a misleading appearance of genuine trading activity or market interest without meaningful change in economic exposure.