Gonzo Crypto Blog - Week 15: Pump the YoBit Jam
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Oct. 16, 2018
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The story of how I almost lost everything in a YoBit Pump & Dump.

I wanted to take part in a Pump & Dump and write an article about it ever since I started doing this blog and I finally got an opportunity to get stuck in.

For those of you who don’t know what Pump & Dump is, it’s an old and very fraudulent strategy of inflating the price of a particular stock with false and misleading positive statements in order to sell it at an inflated price to idiots that get overexcited.

Cryptocurrency Pump and Dumps are slightly different. Our market is significantly smaller than the stock market and there are a lot of people looking out for a way to strike gold, which means it’s a lot easier to manipulate prices and people, especially when it comes to shitcoins with a very low trading volume.

It’s normally coordinated through large groups on messaging apps. I’ve been looking for P&D groups for a while, so I’m now subscribed to at least 10 different Telegram channels and I’ve even downloaded Discord just to keep up with some of the bigger ones.

The one big issue I have with Pumping groups like these is that once the coin is announced to the entire chat group, it’s already overinflated. Clearly, the admins are the ones who get to buy at almost zero prices, and it’s them who offload those coins to the unsuspecting chat members. It’s weird — you think you’re scamming other people on the exchange out of their money, but in reality, it’s your backside which is in fact being scammed. Which, I guess, is a fair game.

Also, before I get into the whole thing I’d like to point out that I fully understand that Pump & Dump is a horrible thing and it casts a very dark shadow on the whole industry. I wanted to take part purely for the scientific interest.

Enter YoBit

Without any doubt, YoBit is the worst exchange I’ve ever used. Most P&Ds actually happen there. It’s full of shitcoins, it has some very questionable services and gambling-like features and perhaps most importantly there is an extremely welcoming chatbox which supports several languages which is an essential tool for luring unsuspecting traders into a Pump & Dump. Also, it’s been known for horrible support services, extortionate withdrawal fees and it’s just overall weird. I mean bad weird.

I’ve used it once, lost about $25 and just left it. About a week ago, I got an email from them which looked something like this:

I couldn’t believe my eyes — they were blatantly advertising an exchange-wide Pump. I opened the link and there was a timer:

I thought for sure this was some kind of an elaborate scam so my first instinct was to stay away, and so I observed from the sidelines. It was absolutely mental.

The Pump

Once the timer reached zero, the page redirected me straight to a PUTIN/BTC trading pair. So yeah, YoBit, an exchange that I personally have no doubts whatsoever is based in Russia, choses a shitcoin called PutinCoin for their first pump, well played lads!

The whole thing went on for about 20 minutes and it was mesmerizing. The order book was a wall of green, prices went up and up and then a bit further up. 15 minutes into the Pump I took this screenshot:

Within about 20 minutes Putin’s volume reached 150 bitcoin. The chatbox was ecstatic, it seemed that everyone at least doubled the amount they’d pumped in. Some people were claiming 5x and 8x profits.

Not going to lie, I was bummed out as hell to have missed out on this. It’s an interesting feeling because I knew that for people to make so much money on this, the more or less equal amount of money must’ve been lost by someone else. When you see things like this you only really think about missing out on being on the winning side of it, not the people who gave into the FOMO and lost big time.

This was the first time I felt the full effect of the FOMO torpor. So, I gave in.

The Dump

Last Friday, I found this in the mail:

The FOMO was very strong. I set up several alarms and reminders, deposited about 0.01 Bitcoins on YoBit and on Monday afternoon I was all set in front of my computer, frantically refreshing the timer over and over again.

The chatbox was a ton of fun. People were comparing this to waiting for the New Year’s countdown, someone was saying they’ve never felt so nervous, even when talking to a girl this one time, a couple of years ago back when she was off her face drunk. Certain phrases were being flung about, like ‘let’s get ready to rumble’ and ‘here we go, we’re gonna be rich guys’.

I was getting a bit worried — too much enthusiasm and not enough skepticism. One guy said something about PutinCoin being bought in bulk 15 minutes before the last pump’s countdown was over. My hands got sweaty, I thought about not doing it for a second, but FOMO was just too strong.

The countdown was over and the coin was revealed - LAMBO. Clearly, they choose coins based solely on what they’re called. The orders started pouring in and they were getting more and more expensive every single second.

Literarily 30 seconds after the countdown reached zero, I placed an order which was just a tiny bit above the last price. Blinded by the panic, I was buying LAMBO for 5 bitcoins. I pressed ‘Buy’.

The adrenaline rush was UNREAL. Everything was happening in slow motion. A waiter that came up to me asking how my irish coffee was got a definitive ‘LATER’ back from me, only when writing this I realized that I actually shouted out that word, poor guy.

But my word, YoBit was so badly lagging.

The order was apparently ‘processing’, but it wasn’t on the list.

I pressed the button again and the error message popped up saying ‘insufficient funds’. I was relieved thinking that I managed to place an early order. I wasn’t thinking about how ridiculous it was buying LAMBO for 5 BTC.

This was going on for about a minute. My jaw was just dangling somewhere around my knees. This was the situation 3 (three) minutes into the pump:

Basically, the first price I saw was 3 bitcoins, then it quickly shot up to 5, I placed my order and one minute later it was trading at under half of bitcoin. By that time, the volume was already at almost 110 BTC. Also, notice how the 24High of 50 bitcoins is already there. Someone went in hard.

3 more minutes later:

I sat there staring at the screen, reading the chatbox, covering the face with my hands. I’d only put a little bit in, but I still felt devastated. People were losing money big time.

Just to put it all into context: this was 10 minutes into the pump. Last time, PutinCoin wasn’t even trading at its peak after 10 minutes. Last time, it was going up and up, slow and steady. The Dump stage was also very evident and it happened slowly, giving most people plenty of time to get out.

It seems that YoBit did the biggest Pump and Dump ever by pumping PUTIN to show off how easy this was and then dumbing people off with LAMBO several days later.

The chatbox was the only thing working properly. I couldn’t open my orders, couldn’t check the balances, YoBit just wasn’t able to handle the traffic, but i guess that was done on purpose as well. Finally, 15 minutes into the pump I opened my order book and rejoiced. My order never went through, thanks to all the lags. I wasn’t the only one either, a similar thing happened to a lot of people. Bless the crypto angels!

I didn’t lose anything, apart from the insane withdrawal fee of 0.0012 Bitcoins I’m going to have to pay when I’ll leave this ridiculous platform forever. 40 minutes into the pump I was still there, mostly reading the chatbox. It was like looking at a messed up car crash. It’s horrible, but you can’t look away:

People were furious. There was a lot of swearing, a lot of profanity, threats of leaving the exchange forever, threats to destroy them in the press, threats of lawsuits and all that stuff that does not mean much but is infused with people’s emotions.

Still, among that shitstorm, there were people saying they made a lot of money on this pump. And then the admins came. They started posting this in the chatbox:

As of 7 pm, people in the chatbox are happy customers once again. Most of them got their money back but all withdrawals were closed. YoBit clearly f*cked up and were trying to sort it out.

So, in the end, what was it all about? What was the point? Was this the last pump? What the hell is the insurance fund? I have so many questions.

I’ve learned a couple a few things today. One — I’m never taking part in a Pump & Dump again. Two — I still know nothing about the world of cryptocurrencies. Three — this was freaking AWESOME!

So goddamn exciting, but don’t do it, really – don’t!

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