The Vibe: A classic scam where insiders hype a coin to artificially pump the price, then sell (dump) their bags at the top—leaving late buyers holding worthless tokens as the price crashes.
The Details: Pump and dump is a market manipulation scheme where a group (often coordinated via Telegram, Discord, or influencers) promotes a low-cap or meme coin with exaggerated claims, fake news, or paid shills to drive massive buying and rapid price increase (the “pump”). Once the price peaks from FOMO inflows, the organizers sell their large holdings (the “dump”), causing a sharp collapse. Victims who bought high lose most or all value. Common in meme coins, micro-cap tokens, and some altcoins—especially on Solana or BSC in 2026. In regulated markets, it’s illegal (securities fraud); in crypto, it’s rampant due to low barriers and pseudonymity, though some cases lead to SEC/CFTC actions. Differs from natural pumps/dumps driven by news or sentiment.
Pro Tip: Avoid coins heavily promoted in pump groups, sudden 10x+ spikes with no real news, or projects with anonymous teams and locked liquidity warnings. Check on-chain data (whale sells, concentrated holders) via DexScreener or Etherscan before buying hype. If it sounds too good to be true and timing feels coordinated, it’s likely a pump and dump—stick to established projects or DYOR deeply.