Most crypto traders and investors are either involved in pumping and dumping or they are into HODLing. For newbies they might not be able to tell the difference so i am going to do a short analysis and by the end of this article you will be able to differentiate the 2 and know how each of them operate.
What is Pumping & Dumping
Pumping and Dumping is mostly done by Crypto currency trader and this is when traders will be looking for altcoins which are highly liquid or newly listed on the market. So as traders collectively they buy and accumulate orders and push the price up and the price will surge and they will be holding their buy positions and this is the phase they call it pumping.
Remember whatever goes up must come down, After they pump the price up there comes a time when they have to take profit. When they get to that point they will now apply the dumping phase. After some traders have seen prices going up and they happen not to have any position in the market, they will be in the FOMO state and this is when they will want to jump into the moving train just because the price is going up.
So when they jump in as a result of FOMO those who were already holding positions they will now release what they have been holding and we can say this is when they will be dumping their altcoins in the market and they will flood the market and as a result the price will fall drastically and those who got in as a result of FOMO they will become the victims of the circumstances.
What is HODLing
This is when investors buy altcoins and hold them in their wallets for a long time e.g a year or so with intentions of selling them off when they have higher value. To some they take this as a retirement investment and they will hold maybe for 10-15yrs going up.
Conclusion
Pumping and Dumping is mostly done by crypto traders and HODLing is mostly done by investors and on the other side there might be some traders who pump and dump then they take the profits and acquire much more stable altcoins which seem to have a bright future.
