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Understanding the effect of pump and storage systems Ripple (XRP)
The popularity of the cryptocurrency world has increased significantly over the years, many investors who were on platforms such as Bitcoin, Ethereum and others. However, this current of new users was not without challenges. One of the most urgent concerns is the increase in pump and storage systems, which is known to handle market prices by artificially swelling the cryptocurrency value.
What are pump and storage systems?
Pump and dup systems are a kind of online fraud that includes investors’ deceptions in buying a encryption currency while waiting for a swollen price. The main purpose of these scams is to create the wrong feeling that assures investors to buy the cryptocurrency at the lowest possible price, which increases value.
The term “pump” refers to artificial swelling of the cryptocurrency by spreading positive information among online communities and social platforms. This can be done in different ways, such as false tweets, reddit forums, or even creating and sharing fake objects. The idea is that the increasing number of investors will increase the demand for cryptocurrency, which increases value.
The effects of pumping and storage systems on wavy (XRP)
Ripple, the cryptocurrency platform of the forehead, has been particularly susceptible to pump and storage systems in recent years. Here are some effects that these scams had on XRP:
- Control : The most significant effect of pump and storage systems on XRP is over -review. These scams artificially increase the price of XRP, which makes it more attractive to new investors and continues to popularity.
- Loss of investors ‘confidence : Pump and storage systems can lead to loss of investors’ confidence in Ripple, which has a major impact on the company’s ability to develop and maintain its market share.
- Reduced liquidity : Inflation of artificial prices caused by these scams can also lead to liquidity in the XRP market. This makes it difficult to buy or sell legal investors by continuing to exacerbate the problem of pump and storage systems.
- Regulatory effect : Pump and storage systems are often associated with regulatory problems because it includes market prices manipulation to avoid compliance with contrary to money (AML) and data (KYC).
Examples of XRP-related pump and storage systems **
Several cases have been documented, where the pump and storage systems focused on Ripple’s price and price. For example:
- Ripple Labs’ own 2018 hacker : In July 2018, a group of hackers got into the Ripple network, causing the cryptocurrency to fall more than 50%.
- XRP Daily Coin Review (YDRV)
: In August 2020, the online publication of XRP Daily Coin Review (YDRV) published false and misleading information, artificially emphasizing its price.
- The “plowing effect” system : a more recent example contains group individuals that promote XRP, called “wave effect”, which was later revealed to be a pump and storage system.
By protecting it from pump and storage systems
To avoid the victim of these scams, investors must be careful when investing in cryptocurrency. Here are some tips:
- Complete a thorough study : Before investing in any cryptocurrency, research technology, team and market trends.
- Keep up to date with regulatory changes : Stay up -to -date with regulatory updates related to the selected cryptocurrency.
- Your versatile portfolio
: Apply investments in multiple cryptocurrencies to minimize risks.
- Use well -known exchanges : place only through well -established and well -known stock exchanges.