- Bittrex emails users to “discourage any type of market manipulation, including pump groups.”
- Email follows BI investigation that exposed widespread “pump and dump” scams in parts of the $300 billion cryptocurrency market.
LONDON — The world’s third-largest cryptocurrency exchange has written to users warning them against market manipulation following a Business Insider investigation that found “pump and dump” scams operating on the platform.
Bittrex wrote an email to users several days ago warning they could be banned or have their accounts frozen if they artificially manipulate the price of coins trading on its platform.
“Bittrex actively discourages any type of market manipulation, including pump groups,” the email said according to a source. “Consistent with our terms of service, we will suspend and close any accounts engaging in this type of activity and notify the appropriate authorities.”
The email follows an investigation by Business Insider earlier this month that found traders are colluding in groups on chat app Telegram to inflate the price of digital coins on platforms such as Las Vegas-registered Bittrex and Russian exchange Yobit. The aim is to make a quick profit by selling the coins on to new investors attracted by the price rise.
Securities lawyers contacted by Business Insider dubbed the actions “market manipulation 101” and suggested that financial regulators should take the same approach to the activities as is does in the stock market, where this type of market manipulation is illegal.
Business Insider emailed Bittrex to confirm the contents of the email by the company did not respond in time for publication. Messages on “pump and dump” chat groups on Telegram, seen by Business Insider, appear to corroborate the email.Bittrex, which was founded by former Amazon security engineers, is the world’s third-largest fee-charging cryptocurrency exchange by volume, Read More Here