Paper Number
2426
Paper Type
Complete Research Paper
Abstract
Pump and dump (P&D) schemes are a phenomenon known from stock trading that quickly expanded into cryptocurrency trading. Several studies dealt with analysis and prediction models related to such schemes in cryptocurrencies already, but only few researchers made use of data related to the underlying transactions available on decentralized exchanges (DEXs). In line with current calls to action, we apply both value and transaction analytics to profile P&D schemes and derive insights on coins as well as participant behavior during such activities. Based on the analysis of over 1.3M transactions related to 288 cryptocurrencies traded on DEXs and 314 P&D attempts, we find that particular cryptocurrencies are more frequently targeted by P&D activities than others and some seem specifically designed for that purpose. Our work contributes to the growing research on fraud in financial markets and characterizes actors and their behavior at the blockchain level.
Recommended Citation
Rath, Oliver; Haase, Frederic; Celig, Tom; Melsbach, Johannes Werner; and Schoder, Detlef, "Profiling Cryptocurrency Pump and Dump Schemes in DeFi: A Chain-Level Analysis of Coins and Participants" (2024). ECIS 2024 Proceedings. 9.
https://aisel.aisnet.org/ecis2024/track16_fintech/track16_fintech/9
Profiling Cryptocurrency Pump and Dump Schemes in DeFi: A Chain-Level Analysis of Coins and Participants
Pump and dump (P&D) schemes are a phenomenon known from stock trading that quickly expanded into cryptocurrency trading. Several studies dealt with analysis and prediction models related to such schemes in cryptocurrencies already, but only few researchers made use of data related to the underlying transactions available on decentralized exchanges (DEXs). In line with current calls to action, we apply both value and transaction analytics to profile P&D schemes and derive insights on coins as well as participant behavior during such activities. Based on the analysis of over 1.3M transactions related to 288 cryptocurrencies traded on DEXs and 314 P&D attempts, we find that particular cryptocurrencies are more frequently targeted by P&D activities than others and some seem specifically designed for that purpose. Our work contributes to the growing research on fraud in financial markets and characterizes actors and their behavior at the blockchain level.
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