Pump-and-dump schemes in the Web3 space manipulate cryptocurrency prices through coordinated buying and misleading hype, enticing investors before a mass sell-off leaves tokens nearly worthless. The decentralized and unregulated nature of this industry makes it particularly susceptible to such schemes. Typically, these schemes unfold in four stages: pre-launch, where hype is generated; launch, where promotional efforts intensify; pump, where misleading information drives up prices; and dump, where orchestrators sell off their holdings, causing prices to plummet. To protect yourself, avoid unsolicited investment advice, be skeptical of social media promotions, and steer clear of unrealistic return promises. The anonymity of token creators complicates accountability, and the 24/7 trading environment lacks regulatory oversight. Recent regulatory efforts, like Operation Token Mirrors, indicate that authorities are beginning to address these issues. Investors should remain vigilant, conduct thorough research, and diversify their investments to mitigate risks associated with potential market manipulation. Read more AI-generated news on: https://app.chaingpt.org/news