Sham Detector

Manipulator's Club - Today's Menu!

Spoofing

This is a classic market manipulation technique which is rampant in most of the exchanges due to lack of controls implemented to identify and stop fraud. In spoofing, the fraudster places a large order on the opposite side(buy, if the intention was to sell) at a price which is away from the current bid ask with the sole intention of fooling the watchers that a large order is underway. For example, assume the fraudsters original goal was was to buy a million shamcoin, where the current bid price is 0.9$ and ask price is 1$. The fraudster will place a large sell order at 1.10$(which will not get executed as there are orders with better prices). Market would react to the large order floating around bringing the price down. Now, the fraudster buys shamcoin at lower price than what was trading. This is a well studied problem in the literature and there exists good models to detect them. We offer a million shamcoins bounty to anyone who shares evidence of this happening.

Pools

A bunch of traders colluding together by trading within the inner circle and pumping up the price. This is mostly rampant on exchanges with low transactions (such as etherdelta etc.). In graph theory, this is a classic community detection problem. We offer a 10 million shamcoins bounty to anyone who shares evidence of this happening.

Churning

Traders placing large number of buy and sell orders simulatneously in order to fool the market by showing fraudulent activities. This should not be confused with market making activity which is legitimate. One way to detect would be common cancellation patters and executions on one side(buy or sell). We offer a 100K shamcoins bounty to anyone who shares evidence of this happening.

Stock bashing

This is mostly done online on public forums and chats where posters make up false and misleading information to manipulate the price of a coin. We offer 100K shamcoins bounty to anyone who shares evidence of this happening.

Pump and dump

When an individual or a group of traders uses various market manipulation techniques(some mentioned in this post) to pump up the price of a coin and then sell once it reaches the intended price. The sell causes the dump which dupes the legitimate investors who are unaware of artifically created demand. We offer a million shamcoins bounty to anyone shares evidence of this happening.

Wash trade

In this manipulation technique, the trader buys and sells the same coin(mostly with the lowest transaction fee) to create an impression of high interest. This is usually to bring artificial attention to a coin. This is similar to Churning except that here the trade actually executes trade. We offer a million shamcoins bounty to anyone who shares evidence of this happening.

Bear raid

This technique is mostly executed on exchanges which allows margin trading. A whale or a group of traders shorts a coin until the price falls, to buy them later at lower price. The manipulation technique to bring down the price could be any of the ones that are mentioned here. We offer a million shamcoins bounty to anyone who shares evidence of this happening.

Quote stuffing

This is mostly algorithmic traders with bots which reacts to markets well before human does, mostly with few milliseconds latency. This is not illegal, however, might drive to a flash crash mostly due to bugs and lack of control in the code. We offer no bounties for detecting this.

Lure and Squeeze

This works when the token developers declares a serious bug in the code, or exchanges announcing trading halts to drive down the price. The inner circle ends up buying a large amount of tokens for themselves before announcing that bug was fixed, or trading halt removed, which makes the price gradually increase to the original value. We offer 10 million shamcoins bounty to anyone who shares evidence of this happening.

**All evidences should be shared on our subreddit(https://www.reddit.com/r/shamcoin/) so that it's transparent to everyone. We will declare (and share transaction confirmation) our verdict in a day, which would be final. Verdict would be declared on the same post with reasons, so that the entire process is transparent and open to comments by everyone.