Over Half of Ethereum Tokens Launched in 2023 Show Signs of Pump and Dump Schemes, According to Chainalysis Data
According to data from Chainalysis, over half of the tokens launched on Ethereum in 2023 were involved in pump and dump schemes, where insiders manipulate the market for profit. However, these tokens only made up 1.3% of total trading volume on decentralized exchanges. The permissionless nature of Ethereum allows anyone to create an ERC-20 token and trading pool, leading to potential fraudulent activity. Chainalysis suggests that this highlights the need for education on how to search for suspicious on-chain activity.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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