The crypto market has just entered into another tough period when a lot of coins started losing its value. In the midst of all the chaos, one cryptocurrency exchange announced a new pump scheme on several random coins, while hoping to get a boost itself.
YoBit Plans a Pump-And-Dump Scheme
YoBit, a Russia-based cryptocurrency exchange that was founded in 2015, has publically announced a pump scheme on their Twitter feed.
This is a part of a scheme commonly known in crypto circles as the ‘pump-and-dump’, which is considered to be a form of fraud. Basically, those who perform the scheme are attempting to boost asset prices artificially, by using false recommendations and misleading news.
YoBit Pump in 22 hrs: https://t.co/RIbW7OhKzM
We will buy one random coin for 1 btc every 1-2 mins 10 times (total buy amount – 10 btc).
— Yobit.Net (@YobitExchange) October 10, 2018
Since this is a type of fraud and is generally an unethical thing to do, many had “hoped” that the YoBit’s Twitter account is “only” hacked, and that they are not serious about these plans.
maybe their twitter is hacked ?! I can’t believe this
— Vanessa ₿ (@CryptoVanessa) October 10, 2018
However, it soon became apparent that this was not the case, as the exchange posted an official countdown clock on their own website.
Needless to say, YoBit’s users were outraged, as was the rest of the crypto community. Soon enough, numerous tweets showing their disappointment emerged on the platform:
— Matt (@matt1BTC) October 11, 2018
I just moved out all my assets from #YoBit.. this is unacceptable!
— R Crypto (@msp_crypto) October 10, 2018
— kungfuturist (@kungfuturist) October 10, 2018
After the tweet was published, more and more investors decided that YoBit has taken things too far. The exchange was known for being innovative, but many feel that this decision has crossed the line. In fact, numerous tweets claim that this will be the end of YoBit.
Self-Regulation on Cryptocurrency Exchanges Drives Institutional Investors Further Away
Due to the fact that regulatory supervision is still absent in most cases, some exchanges have clearly taken it upon themselves to try and make this sector more attractive to institutional investors. While many of them have done things legally, and have made attempts to become better, bigger, and more reliable, there are also exchanges like YoBit.
The interest in cryptocurrencies continues to grow, and new investors are joining the market every day. However, a lot of exchanges believe that this is not enough. They want institutions to join in, and they are not too picky when it comes to finding ways to attract them.
However, what they do not realize is that institutional investors will not fall for pump and dump schemes. They need regulations and security, a guarantee that their investments will provide them with a profit. No amount of scheming will attract institutions. Instead, it is doing quite the opposite.
Thanks to incidents such as the one with YoBit, investors are ensured that the crypto market is still without order and security. Considering how chaotic this makes it, they are simply deciding that it is not worth their time. These are not naive new investors that can be easily tricked, and they won’t join the market unless they are certain that it is safe for them to do so.
This is why YoBit, and any other exchange that might have plans to conduct pump and dump schemes, are only damaging the ecosystem further, and delaying the very thing they want to hasten.
Image from Shutterstock