Identifying and Analyzing Cryptocurrency Manipulations in Social Media

Abstract

Interest surrounding cryptocurrencies, digital or virtual currencies that are used as a medium for financial transactions, has grown tremendously in recent years. The anonymity surrounding these currencies makes investors particularly susceptible to fraud-such as "pump and dump" scams-where the goal is to artificially inflate the perceived worth of a currency, luring victims into investing before the scammers can sell their holdings. Because of the speed and relative anonymity offered by social platforms such as Twitter and Telegram, social media has become a preferred platform for scammers who wish to spread false hype about the cryptocurrency they are trying to pump. In this work we propose and evaluate a computational approach that can automatically identify pump and dump scams as they unfold by combining information across social media platforms. We also develop a multi-modal approach for predicting whether a particular pump attempt will succeed or not. Finally, we analyze the prevalence of bots in cryptocurrency related tweets, and observe a significant significant presence of bots during the pump attempts. KEYWORDScryptocurrency, pump and dump, social media data mining, anomaly detection

Legal Aspects Of The "Pump And Dump" Scheme For Manipulating The Cryptocurrency

“…Kamps and Kleinberg (2018), in turn, use market data to identify suspicious pump and dump based on sudden jumps in prices and transaction volumes. Mirtaheri et al (2019) use data collected from Twitter about cryptocurrencies for these purposes, cross-linked with the pump signal data from Telegram and market data.…”

“…Notably, in their work Mirtaheri et al (2019) revealed the automation of tweets used in manipulations. In this aspect, the experience conducted by Krafft et al ( 2018) is also interesting.…”

Charting the Landscape of Online Cryptocurrency Manipulation

“…This result is even more significant if we consider that we retrieved channels starting from generic invite links occurring in cryptocurrency-related tweets. Despite avoiding to bias our data crawling by starting from a known seed of deceptive channels, as done in other works [9], [14], we still end up with a remarkable number of deceitful channels. Moreover, Twitter botnets emerge as the main vehicle for spreading pump-and-dump invites.…”

“…Content may change prior to final publication. [13] Telegram comprehensive pnd Mirtaheri et al [14] Telegram comprehensive pnd Hamrick et al [15] Telegram, Discord comprehensive pnd Glenski et al [16] Reddit Bitcoin, Ethereum, Monero -Kim et al [17] Forum Bitcoin, Ethereum, Ripple -Kim et al [18] Forum Bitcoin -Vasek et al [19] Forum Bitcoin Ponzi Bartoletti et al [20] Reddit, Forum Bitcoin Ponzi Linton et al [21] Forum comprehensive -…”

“…Along this line, authors in [14] collected pump-and-dump Telegram channels starting from known seeds, and continuing in a snowball fashion. They leveraged such data to predict the success of pump operations in terms of meeting the anticipated price targets.…”