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ChainLink Token Price Manipulation Evidences

Pump and dump manipulation utilizing the Chainlink token, according to researchers, occurred in the spring and summer of 2019.

Evidence of ChainLink Token Price Manipulation iBase Trading.
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Pump and dump manipulation utilizing the Chainlink token, according to researchers, occurred in the spring and summer of 2019.

Researchers claim to have discovered evidence of a coordinated pump and dump scheme employing the Chainlink (LINK) cryptocurrency.

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An examination of suspicious LINK token transactions between April 1, 2019 and July 26, 2019 was published on Sept. 11 by AnChain.Ai researchers in a blog post.

Overview of Pump and Dump

Pump and dump are a type of microcap fraud. It is when the price of an asset is manipulated by a coordinated rush of high-volume purchases by a group of participants working together.

The increase in purchases artificially inflates the asset’s demand. As a result, raising its price and luring in unknowing investors. In addition, the increase in purchases artificially inflates the asset’s demand, raising its price and persuading unknowing investors.

The manipulators dump their tokens towards the end of the scam. Therefore results in exceeding organic demand and causing the asset’s price to drop, leaving victims with devalued holdings. According to the researchers, Cryptocurrencies are particularly vulnerable to this type of attack since coins are frequently concentrated in the hands of a comparably small number of persons. These persons activity in the market can have a significant effect on the coin price.

The Reported 2019 LINK Pump and Dump Manipulation

AnChain.Ai has released a full timeline, which includes links to numerous allegedly implicated tweets. Firstly, the date of LINK’s launch on cryptocurrency exchange Coinbase. Secondly, a chart of the asset’s price changes — from $1.19 on June 13 to $4.45 by June 29, before dropping to $3.73 on July 2.

AnChain.Ai describes the criteria it employed to detect an obviously coordinated set of addresses that it suspects is responsible for the increase in transactions. An example is using numerous jump addresses to conceal the token flow.

The post goes on to explain how Ether (ETH) gas fee trails may be studied. This is to show that, as the researchers point out, all of the ETH transmitted to the jump addresses comes from mining nodes. This is a smart strategy that conceals the true address of the player.

AnChain.Ai finishes by saying that the presence of thin markets in the crypto industry makes it prone to manipulation. As a result, a need for additional due diligence is critical to the sector’s future.

They also highlight the immutability of blockchain technologies. This allows for a complete examination of marketplace activity and network contact. Being that, allowing investigators to build a directory of important addresses, affiliations, and transaction pathways that are useful for surveillance.

New research published last month revealed the apparent widespread use of arbitrage bots for deceptive profit-making techniques on decentralized exchanges.

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Tanya Smith is an editor at iBaseTrading. With M.A. in Journalism and Mass Communication, she is pursuing her dream of creating a positive difference in the media industry. She also enjoys Fashion and Travelling.