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Author: Dilip Kumar Patairya, CoinTelegraph; Compiled by: Deng Tong, Bitchain Vision
1. What are the anti-dumping principles of cryptocurrency?
Anti-dumping principles are designed to protect cryptocurrency investors from the impact of pulling up sell-off plans.
The term “anti-dumping principle” refers to the action taken by a project developer, community or exchange to prevent financial fraud, in which a scammer sells his cryptocurrency when the price reaches a certain level in order to make huge profits before exiting the market.Since then, prices have fallen sharply, causing other investors to suffer significant monetary losses.Anti-dumping principles are designed to combat this scam.
In the cryptocurrency field, anti-dumping is different from the traditional anti-dumping measures taken by the government to protect domestic industries from foreign imported products.The government will impose protective tariffs on imported goods and services, leveling the playing field for domestic producers and saving the domestic economy.
2. What is the high selling plan in cryptocurrency?
The “sell high” plan involves an organized entity or a group of individuals artificially raising the price of cryptocurrency tokens and then selling their holdings to earn profits, thus causing investors to lose money.
Fraudsters artificially raise prices by spreading misleading information about tokens and curating demand for tokens by coordinating purchases.
To make a profit, unsuspecting investors accumulate assets in advance at lower prices.The scammers then sold or sold their holdings at high prices, triggering a dramatic crash.Although the initiator made huge profits, other investors (believe in the potential of the asset due to artificial hype) lost all their investments.
Planners who pulled up the sell-off plan took advantage of the largely unregulated cryptocurrency industry.They drive up sentiment before cashing out scam tokens, causing other investors to lose money and often lose confidence in the crypto ecosystem.
3. How does the anti-dumping plan work?
Anti-dumping measures in the cryptocurrency space help protect investors by limiting or finesing a wide range of token dumping or setting vesting periods.
Anti-dumping regulations limit the purchase or sale of large quantities of tokens in a transaction, limit orders for the entire supply, apply value limits or set daily limits or price caps.A sell-off is usually done by fraudulent investors who buy large amounts of tokens to push up the price significantly and then sell it for huge profits.
Here is how anti-dumping principles work:
Purchase and sales restrictions
In the ever-changing cryptocurrency space, projects often adopt strategic controls to maintain token stability and prevent market dumping.For example, they incorporate purchase and sale restrictions into smart contracts.These technologies are critical for long-term sustainability and investor trust as they reduce the risks posed by price volatility.
Ethereum’s EIP-1559 update changed the fee market mechanism, burning a portion of transaction fees, which could reduce the overall supply over time, potentially increasing value and reducing the motivation for selling.
By incentivizing node operators to participate in the network, Chainlink encourages node operators to retain their Chainlink (LINK) tokens to continue to collect expected rewards, thereby reducing the likelihood of dumping.According to the scheduled inflation schedule, a certain percentage of Solana inflation is designated for pledge rewards.Therefore, holders are encouraged to stake their tokens, which reduces the liquidity supply in the market and prevents dumping.
Token Attribution
Token Attribution requires locking newly created or acquired tokens and releasing them after a predetermined time.Tokens awarded to project founders and initial investors are often vested over time.
This technology prevents tokens from flooding into the market and prevents founders from trying to make money quickly and then giving up on projects.Investors should consider the project’s exercise schedule.
4. How can investors avoid pushing up their selling plans?
Investors should conduct due diligence and choose projects that create value and are transparent.They should avoid projects that promise to get rich quickly.
Escape from damage is usually the best way to deal with it.When it comes to cryptocurrencies, investors need to be cautious, conduct adequate research before investing, and avoid projects that seem untrustworthy.
Stay alert and supervise
Before investing in any project, investors should be wary of dumping risks and act cautiously.Investors should investigate the founder of the project and their track record and review relevant documents to determine whether there are signs of warning.
The Squid token is a great example of a plan to pull up the sell-off, where signs of fraud are obvious.The token dropped from $90 to $0.00079 in just a few minutes.The investigation shows that the creator of the token does not exist and is anonymous.There are many spelling errors in the project’s website and white papers, supplementary materials and other related documents.
These warning signs indicate fraud, which they could have avoided if investors remained cautious.Some social media groups say it’s coming soon.Actively participating in these groups and knowing warning signs may help prevent such fraud.
Ensure the project is reviewed
Comprehensive smart contract audits help prevent vulnerabilities in your code.Full review emphasizes the project’s commitment to safety and security protocols.Project owners with fraudulent intentions may intentionally leave loopholes that can be exploited later.
Anti-dumping measures are included through smart contracts and audited by reputable auditors.It is very likely that fraudsters have not implemented what they claim to have yet to implement.If a project is open source, one can use the relevant code to determine how it works behind the scenes.If investors lack technical knowledge, they can seek the help of an auditor.
Avoid falling into FOMO state
In the cryptocurrency space, “FOMO” (i.e. “fear of missing out”) is a truly worrying issue.When the value of digital assets rises, many investors feel pressured to take advantage of the trend.This behavior triggered a sharp rise in prices and then a sharp decline.For example, Bitcoin’s price has recently exceeded $70,000 due to factors such as Bitcoin halving expectations and approval of spot Bitcoin exchange-traded funds.Some investors may be affected by FOMO and buy when the price of Bitcoin is at its highest, but eventually suffer losses if the price falls later.
Investors should avoid investing heavily in lesser-known cryptocurrencies.In any case, investment should not exceed the losses they can afford.
Consider the Lindi effect
The Lindy effect refers to the fact that things that are not perishable (such as technology) are old, the more opportunities they have to live longer.Technologies or projects that have been around for some time will have a higher chance of persisting and maintaining their relevance.
Investors can use the Lindi effect to evaluate the lifespan and potential profitability of cryptocurrency and blockchain projects.If a blockchain project has proven its durability, it is more likely to continue operating and generate profits in the future.
