Market manipulation can be described as any attempt to interfere with the free and fair operation of the markets. This concept has become more popular as more businesses pop up, but is very much illegal and considered by law to be fraud. Not exclusive to crypto markets, various acts of market manipulation can be found across all traditional trading sectors including the stock market.

There are many ways to practise market manipulation, such as falsifying numbers to attract investors' interest leading them to invest in the company and buy stocks that they otherwise would not have. Another method of market manipulation, especially crypto market manipulation, are pump and dumps, and that's exactly what we're covering in this article. 

What are pump and dump schemes? 

The term pump and dump can be traced back to as early as the 1990s when broker Stratton Oakmont artificially inflated the price of the stock he owned. Through false advertising and misleading statements, he created positive sentiment around his stock and then sold his cheaply purchased stock at a much higher price leading to great profits. 

This may have been long ago, but pump and dump schemes quickly became popular in the stock market and cryptocurrency trading sector. Funnily enough, pump and dumps within crypto were driven by John McAfee, creator of McAfee software security. John McAfee was not the only person to partake in pump and dumps, but he was the leader at the time.

He created trading groups where they would discuss which project to push funds into, driving the price up, and then selling for a substantial profit. People would see the price rise 200% in 15 minutes and buy in, and that's when McAfees' army would sell. This is similar to Oakmont, where he bought cheap stock and drove up the price so he could sell it for much more.

Are pump and dumps a scam?

Yes, usually they are a scam that only benefits insider traders, such as pump and dump group members. Even members of pump and dump groups can fall victim to this scam, as there is even insider trading within insider trading, meaning if they don't sell soon enough they will lose funds. In the traditional financial sectors, there are laws in place to prevent this problem.

How long does a pump and dump last?

That depends on what the pump and dump groups agree on, some only last a few minutes while others can last a few hours or days. The duration of a pump and dump is reliant on what the group agrees to. 

Are pump and dumps illegal?

In short yes, but not as broadly as they should be. Pumps and dumps in the fiat financial world are very much illegal and could lead to jail time. In the United States, it is a crime worthy of up to 5 years of incarceration or a $250,000 US dollar fine, or both, however, laws vary in different countries. So, there are clearly rules and laws in place to deter fiat or stock traders from participating in pumps and dumps, but the same can not be said for cryptocurrency trading. 

While there are no laws against pump and dumps in cryptocurrency, it is still extremely immoral. Many industry participants use this argument to call for greater regulation in the space. This can be seen in comparison to fiat, where it is considered illegal, so why not do the same for cryptocurrency? 

Are pump and dumps illegal in cryptocurrency? No. Should they be? Yes. As governments around the world work to establish a regulatory framework around cryptocurrencies we can only hope that pump and dump schemes make a feature.

Has Bitcoin had a pump and dump?

No, while Bitcoin has its own share of volatility, in the years since it's gained considerable value it has not been involved in a financial scheme of this nature. As its value is so high it would take a huge amount of investors and value to alter the market to this proportion.

Which coins are pump and dumps?

Generally, pump and dump coins are low market cap coins that are susceptible to volatility, meaning any money put in makes a big difference. However, pump and dumps can happen to almost any coin, the lower market cap coins are just usually the target in the crypto space.

Closing thoughts 

Pump and dump groups are a tricky topic within the cryptocurrency space, as some people greatly gain from these market tactics. Aside from the victims of pump and dumps, it is illegal within the fiat financial sector and should be considered the same regardless of whether governments see cryptocurrency as a legitimate tender.  

Whether you're new to investments or you've been active in the markets for years, it's never too late (or early) to get your head around the different types of investment opportunities available. As we know, one size never fits all, so in this piece we're going to run you through the options out there to help you determine which category is best suited to your needs. 

The 3 tiers of investments

First and foremost, when diving into the world of investing one must first determine their risk tolerance. Understanding how much risk you are willing to engage in will help you establish which investment avenue to go down. The three options are:

1. Low-risk 

These types of investors are not looking to take risks with their capital. The primary goal is to preserve the initial investment despite the opportunity to gain returns. This is a great start for new investors as the risk is minimal while they learn the ropes. 

A great investment option within this risk category is a money market fund. The funds are typically managed by professional licensed fund managers, and involve bank deposits, commercial papers and treasury bills. While the risk is low, the potential for returns is moderate and the investment is liquid, meaning that the investor typically has access to the funds at any time. 

2. Medium-risk 

Providing an option for the more confident investor, medium-risk investments incorporate moderate risks but have measures in place to stop any high losses. This strategy is often made up of low-risk and high-risk investments, ensuring a balance between the two components. 

Medium-risk options include a mix of mutual funds and dollar funds, which will invest in medium-risk stocks, bonds and treasury bills. The risk of losing capital is therefore lower than with high-risk investments while your potential for returns are higher than low-risk investment options. 

3. High-risk 

This category is for the investors with an appetite for risk. They're comfortable with losing their invested capital in the pursuit of higher gains. A huge note here is that Ponzi schemes are never good investments. Rather stick to professionally managed investment funds that are catered to those with a high-risk threshold. 

These might include equity mutual funds that invest in stocks of vetted companies with large public listings. These are best catered to long-term timelines, as volatility might hinder the returns in a shorter space of time. High-risk investments have the potential to bring about higher returns, however, this is never a guarantee.
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How to distinguish what type of investor you are

While a professional financial advisor can do this for you, we've created a three step, simple way to determine whether you fit into the conservative investor (low-risk), moderate investor (medium-risk) or aggressive investor (high-risk) category. Consider these three factors below:

• What is your age?

If you're younger, there are more years ahead of you to recover from a bad investment. As a result, each passing birthday slightly lowers your risk tolerance.

• What is your marital status?

As a general rule of thumb being married incurs more expenses and allows for less risk-taking when compared to a single person with no one else to be responsible for. With fewer financial responsibilities comes a high opportunity for risk-taking. 

• What is your net worth?

Last but not least, your net worth will also impact your appetite for risk. The more money you have, the more you can risk to make that money grow (and the bigger the cushion if an investment does go south).
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In conclusion‍

It's important to remember that one investor type is not better than another, rather, it is about what is best suited to your needs and requirements. The longer you leave these investments the higher the returns, so be sure to have a solid savings account built up prior to investing to ensure that should something go wrong you have alternative sources of funds to support that. Liquidating your investment early might lead to losses and most certainly lost opportunity. 

Please consult a financial advisor should you want more information. 

The Graph is making the process of interacting with blockchains much simpler by streamlining the building of new apps and the process of tracking valuable data, powering the growth of DeFi and Web3 platforms. The platform allows developers to provide improved user experience across the board, as opposed to having to create custom back-end infrastructure for each application.

The Graph indexes blockchain data in a unique and decentralised way which allows for the seamless querying and retrieving of data that is easily accessible and can be adopted by many. The platform's contribution to the global DeFi and Web3 infrastructure will be felt in years to come.

What is The Graph?

The Graph is a unique decentralised protocol that utilises DLT (decentralised ledger technology) and the powerful GraphQL programming language to enable blockchain data collection without relying on third parties. The cutting-edge technology makes it simpler than ever before to index, organise, and query blockchain data information with impressive accuracy and speed.

The Graph provides indexing and querying services that are compatible with networks like Ethereum, IPFS and PAO, with more to come in the future. The infrastructure can then organise data through the hosted service and implement automated workflow processes through open APIs, called subgraphs in The Graph ecosystem.

This indexing protocol resolves the issue of querying data security, chain reorganisation, and other related matters with the subgraphs.

The launch of The Graph mainnet marked a milestone in creating entirely decentralised applications compatible with an expansive network of service providers. With these open public subgraphs, developers can now build thousands of dapps on the network, with hundreds already hosted by The Graph mainnet. This allows for secure blockchain data access making the world far more connected than ever before.

The Graph (GRT) successfully raised $12 million from a public token sale and an additional $7.5 million from a private round funded by Coinbase Ventures, Digital Currency Group, and Framework Ventures including Multicoin Capital's investment of $2.5 million.

How is The Graph network secured?

The Graph mainnet is powered by nodes, while indexers, curators, delegators, and consumers use GRT tokens to ensure the integrity of the data secured within the network. GRT is The Graph network's native cryptocurrency which helps to assign resources within its ecosystem. All network participants are required to stake GRT in order to perform their roles, and in return can earn fees from the network.

The Graph Foundation offers the network participants coordination and support while steering and growing the ecosystem. The foundation is financially and legally accountable to The Graph Council, which oversees governance decisions.

Who created The Graph platform?

Driven by his firsthand experience of how hard it is to create new dapps on Ethereum, Yaniv Tal joined forces with Brandon Ramirez and Jannis Pohlmann in 2018 to form The Graph team. The Graph aims were to design the world's first decentralised indexing and querying application that could make Web3 and dapp creation accessible to anyone. This vision included the ability to build immutable APIs with the GraphQP query language. 

The three co-founders previously launched a developer tools startup together sharing a common interest in optimising API stacks. All with engineering backgrounds, Yaniv Tal acts as project lead, Brandon Ramirez is the research lead and Jannis Pohlmann is the tech lead.

The Graph launched on December 17, 2020.

How does The Graph protocol work?

By leveraging the Graph Protocol, developers and users can open APIs to build subgraphs for a variety of applications. In April 2021 alone, The Graph’s hosted service managed 20 billion queries - further demonstrating its power in data indexing, querying data, and its collection of data.

The Graph node sustains the whole system, scanning through the blockchain database to organise and index data. The platform's structure is centred around delegators, indexes, curators, and consumers, who use GRT tokens to participate in the network. 

Indexers - Graph node operators

With staked GRT, indexers can provide querying and indexing services to the network, earning query fees and rewards for their efforts. They are also responsible for running node software providing a vital part of The Graph ecosystem that grants access to data stored on Ethereum or other supported networks at lightning speed. Indexers are the most technical positions within the ecosystem.

Curators - identity blockchain data sources

Curators are responsible for developing subgraphs (open APIs are called subgraphs on the network) and signalling to indexers which ones should be indexed by the network. They also identify the most reliable data sources using their knowledge of the blockchain ecosystem, consumers and apps.

To incentivise the quality of their data sourcing, curators are required to deposit GRT into a bonding curve on specific existing subgraphs, earning a portion of the query fees for the subgraphs they signal on. The earlier a curator signals on a subgraph the higher the share of query fees they earn, depending on the amount of GRT deposited. 

Curators are semi-technical positions within the ecosystem as they require an understanding of open data. As an example, say a new DeFi subgraph appears and a curator thinks it looks promising. They can signal on the subgraph so that indexers recognize its potential and make it discoverable for dapp developers. In return, curators receive a portion of query fees for being among the first to spot it.

Delegators - securing the network

Delegators are non-technical contributors to the network and are responsible for securing the network without running a node. They select indexers based on performance metrics and delegate GRT to indexers via the Graph Explorer dapp, earning a portion of the query fees and indexing rewards in return. 

Consumers - end-users

Consumers are the end-users of The Graph and are the ones who query subgraphs and pay fees to indexers, curators, and delegators for their services. These query fees are paid through gateways or wallets that are built on top of the open-source contracts on the network. 

What is GRT on The Graph network?

The Graph (GRT) is an ERC-20 token and the native token to The Graph network. The coin is integral to the reward system created to benefit indexers, curators, and delegators, which incentives them to improve the market and network operations. 

Delegators can delegate their GRT holdings to Indexers, who use locked GRT to power the nodes on The Graph network. Curators receive a reward in the form of GRT for providing curation services and consumers pay using GRT to access indexing services. Additionally, unlocking dapps available through The Graph network as well as interoperable networks is done by using GRT tokens. 

Participants of the network earn money by receiving The Graph GRT tokens, which have a market value when traded on the cryptocurrency market.

10 billion GRT were created when the project launched, with an annual issuance rate of 3% for indexing rewards. The platform then burns the withdrawal tax that curators are charged as well as 1% of the total query fees. All issuance formalities are subject to future technical governance. At the time of writing, the current circulating supply of GRT was 6,9 billion. 

To accumulate GRT tokens, users will need to make use of a cryptocurrency exchange. Ensure that the one you use has been vetted and holds the necessary licenses. 

With the second biggest cryptocurrency being at the forefront of mainstream media recently, you might have come across the term “gas” or “Ethereum gas fees”. In this article, we’re breaking down what this means, what it’s used for, and what the future holds for gas fees as the network transitions into ETH 2.0. 

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What are Ethereum gas fees?

Getting straight into it, gas fees are the network fees payable on the Ethereum platform. Similar to how transaction fees need to be paid on the Bitcoin network when executing a transaction, Ethereum gas fees operate in a similar way. 

In more technical terms, the term refers to the computational efforts required in order to execute specific operations. While the Bitcoin network facilitates transactions (being a medium of exchange), the Ethereum network allows users to do a bit more than that. On the network, developers are able to build decentralised applications (dapps) as well as smart contracts, each of which requires a different amount of energy or gas to execute. 

Using a real-world example, if you were driving 100km your car might need 10 litres of fuel. 100km represents the utility value while the 10 litres represents the cost of executing the operation. Similarly, if you were making a transaction worth 100 ETH, the gas price to process this might be 2/100,000 ETH, the cost of executing the operation. 

The fees are determined by supply and demand as well as the miners executing the operations, and if the fee is not aligned with the computational effort required, the miners will not complete the task (and instead choose to ignore it). Similarly to the miners receiving the transaction fees on the Bitcoin network, the miners responsible for verifying and processing these transactions are rewarded with the gas fees.

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How is gas measured?

To distinguish between the cryptocurrency (ETH) and the gas fees, the fees are referred to as gwei. While this is a smaller denomination of ETH, gwei still provides a clear-cut value layer that is solely responsible for outlining the cost of the computation expenses.

Gwei, also known as nanoether (nano for short), is short for gigawei indicating it is worth 1,000,000,000 wei. Wei to Ethereum is what Satoshis are to Bitcoin, both representing the smallest denomination of the cryptocurrency. In summary:

• 1 gwei is worth 0.000000001 ETH
• 1 ETH is worth 1,000,000,000 gwei

To give you a better understanding, below is a summary of all the denominations of Ether:

1 ETH = 1,000,000,000,000,000,000 Wei

1 ETH = 1,000,000,000,000,000 Kwei

1 ETH = 1,000,000,000,000 Mwei

1 ETH = 1,000,000,000 Gwei

1 ETH = 1,000,000 Szabo

1 ETH = 1,000 Finney

1 ETH = 0.001 Kether

1 ETH = 0.000001 Mether

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What ETH 2.0 means for transaction fees

The platform’s upgrade is designed to increase scalability, solve the current transaction fee issues and make the network able to handle thousands of transactions a second. As Ethereum migrates into its new version the network will be moving from a proof-of-work consensus to a proof-of-stake consensus, as well as implementing sharding. 

This means that the mining process will move away from miners battling to be the first to solve the complex puzzle and create a block, instead, shifting to a verification process based on staking and random selection. No longer called miners, validators on the network will be chosen by random selection based on the amount of ETH they are currently staking. 

The implementation of sharding (where a large chain is split into smaller chains called shards) allows for much faster transaction execution. Transaction validation will be assigned to various validators, each overseeing different shards. Recently there have been complaints across the industry of high gas fees experienced on the Ethereum network, this is due to high congestion which sharding will easily resolve. 

The implementation of ETH 2.0 is believed to lower transaction fees, increase scalability, decrease the energy-intensive processes, and increase the number of transactions the network is able to handle. 

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Ethereum and the future

While we’ve covered the basics of what Ethereum gas fees are, there is likely to be a shift in the number of gas fees charged in the coming months. The concept will remain the same, users will still be required to pay a small fee in order to execute their transactions, however, it is likely that the sharding implementation will bring these fees down. 

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While these terms might seemingly be used interchangeably, they are in fact fundamental differences between them. Whether you're brand new to the industry or have been in the market for a while, distinguishing between the two will be a valuable endeavour. When it comes to the business of blockchain assets and the information surrounding it, we know all about it. Let's get into it.

What are digital assets?

Digital assets are non-tangible assets that are created, traded and stored in a digital format. This includes everything from a website to a spreadsheet to a logo, anything uniquely identifiable that holds value. In the context of digital assets vs cryptocurrencies vs tokens, both cryptocurrencies and tokens are digital assets as they're created, stored and traded using blockchain technology. 

Through blockchain technology, cryptocurrencies and tokens utilise an advanced encryption technique known as cryptography. This maintains their security and ensures that the digital assets cannot be counterfeited or double-spent. Each individual asset represents something, whether it be content, value or a tangible item.

What are cryptocurrencies?

While cryptocurrencies fall under the umbrella of digital assets, they too hold a unique characteristic. In order for a digital asset to be classified as a cryptocurrency, it must be created on its own unique blockchain (often referred to as a blockchain's native token). 

Cryptocurrencies can be traded as a medium of exchange or store of value, depending on the platform for which it is built. On top of that, cryptocurrencies can also be used to pay transaction fees for using the network, or as an incentive to ensure the network is well-maintained. 

Typically, cryptocurrencies are decentralised meaning that they do not rely on a central entity to maintain the network, instead, they are operated using code to facilitate transactions and issuance. Built using blockchain or distributed ledger technology (DLT), cryptocurrencies use cryptography to secure each network in an automated, trustless manner and avoid any fraud.
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Bitcoin, as it is created using its own blockchain and acts as a form of digital money, is an example of a cryptocurrency.

What are tokens?

Tokens differ from cryptocurrencies in that they are created on top of existing blockchain networks and not their own. A prime example is any ERC-20 token built on top of the Ethereum network. While these are still digital assets, they are classified as tokens due to their use of an existing blockchain. DAI, COMP and USDT are all examples of tokens that utilise the Ethereum blockchain.

While some are also mediums of exchange or stores of value, tokens provide more varied use cases. For example, some tokens are used to play games while others might be used for services specific to that platform, or across the greater decentralised finance (DeFi) landscape. 

There are a number of token standards available which each serve different use cases, the majority of which are built on Ethereum. The most common, the ERC-20 token standard, allows for the creation of a token that can then be used across a range of compatible dapps (decentralised apps). Another common token standard is the ERC-721 which is used to create non-fungible tokens, NFTs.

Tokens are typically characterised by the following:

• Permissionless
• Programmable
• Trustless
• Transparent

Tokens tend to take on much wider use cases, such as representing both tangible (property, art) and non-tangible (processing power, governance rights) aspects, which are integral to the running of the blockchain network. ‍

In conclusion

Digital assets encompass both cryptocurrencies and tokens, while cryptocurrencies are built using a unique blockchain, and tokens are built on top of an existing blockchain.

Since Bitcoin was launched in 2009 there has been an ongoing wave of alternative cryptocurrencies entering the crypto market created to build on what the original cryptocurrency (and blockchain technology) can do. While Litecoin and Ethereum differ vastly in their design, one similarity is that they were both created to improve on so-called weaknesses in the Bitcoin network.

In this piece, we’re taking a look at both Litecoin and Ethereum individually, covering everything from concept to market integration, as we explore Litecoin vs Ethereum.

The Litecoin network

Litecoin is a digital currency created from a hard fork off of the Bitcoin blockchain. The cryptocurrency was designed to be a "lighter" version of the original cryptocurrency (hence the name) and to provide a more efficient peer-to-peer digital cash system. Litecoin (LTC) is the native coin to the network. 

With similar coding, the Litecoin team made several changes to their blockchain to ensure that it was faster and more cost-effective. It was never designed to overtake Bitcoin, merely to offer an alternative and complement the Bitcoin network.

Created in 2011, Litecoin was launched by a former Google engineer and MIT graduate, Charlie Lee. Lee, alongside a team of developers, increased the block size as well as its total supply. Litecoin has a max supply of 84 million coins. 

Transaction per second

Today, the Litecoin network can process 56 transactions per second compared to Bitcoin which can do 7 transactions per second (outweighing Ethereum which can currently do 30 transactions per second, expected to increase greatly with the launch of ETH 2.0).

Transaction fees

Litecoin also trumps both cryptocurrencies when it comes to lower transaction fees, charging a minute fee that is not subject to fluctuations. Most cryptocurrencies' transaction fees fluctuate due to demand on the network, increasing the fees when the network is busy.

Block size

The network also reduced the block time, meaning the amount of time it takes to validate a transaction. Litecoin transactions take 2.5 minutes on average, whereas Bitcoin transactions take 10 minutes. In conclusion, a Litecoin transaction can be processed at a lower cost, four times faster, and with 3% of the energy consumption.

Mining process

While Litecoin makes use of the same Proof of Work mining consensus as Bitcoin, it uses another hashing algorithm known as Scrypt that requires specifically designed mining software and hardware. This is the same setup as Dogecoin, allowing miners to mine both cryptocurrencies simultaneously. 

The Ethereum blockchain

Ethereum is a decentralised platform that allows developers to create their own decentralised applications (dapps) and smart contracts. Ethereum is well-known for its neutrality and immutability features, contributing to its effectiveness as a platform for developers to launch new projects. On the blockchain platform, it uses Ether (ETH) as its native cryptocurrency.

Ethereum was created to leverage the open-source nature of Bitcoin and bring greater innovation to the cryptocurrency industry. Providing a platform on which developers can create new blockchain projects has led to a large number of new cryptocurrencies and the inclusion of many industries far beyond the finance sector. 

Transaction fees

Ethereum uses ETH to fuel all operations on the network, requiring users to pay what are known as "gas fees" to facilitate any Ethereum transactions. These gas fees are designed to compensate miners for the computational power required.

These fees fluctuate when the network is congested, often leading to exorbitant prices for users wishing to implement smart contracts or send funds across the network.

Smart contracts

Smart contracts are digital agreements that automatically execute once certain criteria is met. When the smart contract is created, the agreement and criteria are written into its code, and once the criteria is met, that contract will automatically execute.  

Total supply

Due to the nature of the Ethereum blockchain providing a platform on which users can build and develop, the cryptocurrency does not have a limited supply of tokens. With no cap, the network can continue creating tokens as required and developers can continue using the platform to execute operations and build apps. 

Ethereum does have a limit on the total number of new coins that can enter circulation each year. Its supply growth model ensures that no more than 18 million coins can be released per annum.

Mining process

Currently, the Ethereum network uses a Proof of Stake consensus. This new version adoptd a more sustainable method of validating transactions and creating new coins. 

Which is better: Litecoin vs Ethereum

While Litecoin provides a peer-to-peer form of digital cash, Ethereum offers more than just a coin, it provides a platform. When it comes to functionality, Ethereum takes the cake.

However, when it comes to executing benefitial transactions, and in terms of scarcity with its limited supply, Litecoin provides a better blockchain payment alternative.

When it comes to Litecoin vs Ethereum and which cryptocurrency is better, one must first observe their intentions. Are you looking to build dapps or for a quick and cheap means of sending funds across the globe?

Both networks have avid supporters and great teams behind them, so when deciding which cryptocurrency to buy in consider your own goals and how these two networks align with them, or seek investment advice from a professional that can help you with making an informed decision.