## Why Investors Fall into Pump and Dump Traps

In the cryptocurrency market, one of the most widespread and harmful frauds remains the so-called pump and dump. But what makes this strategy so dangerous, and why does it continue to attract new unsuspecting participants to the market?

### The mechanism of market manipulation

It all starts with a coordinated group silently accumulating large amounts of a specific digital asset—whether it be a token, an NFT, or other forms of cryptocurrency. These individuals leverage social channels and the dissemination of often unfounded information to create a wave of artificial enthusiasm around the asset. The goal is simple: to attract a mass of "retail" investors who, seeing the growing interest, fear missing out on an opportunity and buy at ever-increasing prices.

At this point, the inevitable happens: those who orchestrated the initial operation massively sell their holdings, causing a vertical collapse in the price. The latecomers—those who bought at the peak—suddenly find themselves stuck with devalued assets, realizing significant losses.

( The role of investor psychology

The true strength of this practice lies in exploiting FOMO )fear of missing out###. Investors, driven by the desire for quick profits and the fear of missing out on an opportunity, suspend critical thinking. Independent research and fundamental analysis are abandoned in favor of emotional and hasty decisions.

( An illegal and counterproductive practice

It is essential to understand that pump and dump is not only immoral: it is illegal. It represents a form of market manipulation and fraud that undermines the integrity of the crypto ecosystem as a whole. Every scheme of this kind fuels distrust, drives away responsible investors, and slows down the legitimate adoption of blockchain technology.

) The correct way towards informed investments

The best defense remains due diligence ###DYOR###: investing time in studying projects, analyzing their fundamentals, understanding the technology and the roadmap. Solid projects do not require artificial hype—their value emerges naturally over time. Avoiding promises of quick gains means protecting oneself from pump and dump schemes and building a sustainable long-term portfolio.