Paper Number

2426

Paper Type

CRP

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.

Share

COinS
 
Jun 14th, 12:00 AM

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.

When commenting on articles, please be friendly, welcoming, respectful and abide by the AIS eLibrary Discussion Thread Code of Conduct posted here.