Telegram Stock Group: How does the Telegram Crypto Scam work? A Telegram Stock Group – alternatively known as a Pump and Dump Group – is a virtual meeting place for speculators. There, in a group on the messenger Telegram, both stock prices and crypto prices are manipulated.
Moderators play a key role in these price manipulations. They give Telegram users precise instructions on when to invest or sell. In addition, backers of a Telegram Stock Group apply the pyramid scheme, give dubious buy recommendations and grant questionable loans.
In the following article, we inform you why you should be wary of financial products and crypto projects offered in a Telegram Stock Group. For this purpose, the lawyers of the Herfurtner law firm refer to the fraud cases they are currently aware of.
Telegram Stock Group: How does the price manipulation work?
To help you better understand how the price manipulation of cryptocurrencies in pump and dump crypto groups works, we explain the pump and dump scam.
- In a Telegram Stock Group, thousands of Telegram users conspire to artificially inflate (pump) the prices of cryptocurrencies by means of investments.
- Within a few minutes, they sell (dump) the cryptocurrencies again and make enormous profits. This leads to a serious drop in the price.
- The victims of this manipulation are investors who have invested in the cryptocurrency due to the price increase and subsequently have to accept enormous losses.
- Finally, a Telegram Stock Group deletes all references that indicate which cryptocurrencies have been manipulated.
Which digital currencies are affected?
The scam described here is mainly applied to low-capitalised digital currencies. Their market values are often in the single to double-digit millions. In contrast, larger cryptocurrencies tend to be less in focus, as their holdings are not sufficient to cause effective price changes.
Telegram Stock Group: current legal situation in Germany
In November 2003, the Federal Court of Justice classified the pump and dump scam as prohibited market manipulation (§20a Securities Trading Act (WpHG)). In addition, all important regulations have been included in the Market Abuse Regulation since 2016.
Consequently, it is possible to assess market manipulation either as an administrative offence (Section 120 (15) No. 2 WpHG) or as a criminal offence (Section 119 (1) WpHG). If the former is the case, offenders can be fined up to €15 million.
Alternatively, the fine to be paid may amount to 15 % of the annual turnover. If, on the other hand, a criminal offence has been committed, imprisonment or fines may be imposed (section 119 (1) WpHG).
The maximum possible prison sentence is 5 years. As a rule, a criminal offence always exists if the use of the fraud scheme has led to a change in the share price.
Whether it is a criminal offence or a misdemeanour, it is generally difficult for the authorities to prove that the perpetrators have deliberately manipulated share or crypto prices.
Telegram Stock Group: known cases of fraud
In a Telegram Stock Group, financial products with high return prospects are advertised and investors are defrauded of their assets by means of Telegram Crypto Scam. To prevent you from falling into the trap, we explain why investments should be treated with caution. The lawyers of the Herfurtner law firm present current cases.
Crypto Pump and Dump Groups: HyperVerse
The network HyperVerse – formerly HyperFund – advertises crypto projects in Telegram groups. Although financial regulators around the world warn against HyperVerse, the promises of high returns are now attracting tens of thousands of investors.
In this context, HyperVerse even holds out the prospect of doubling investments. However, such investments are not advisable, as
- it is unclear how the return is to be achieved,
- the initiators are not known by name
- and presumably a pyramid scheme is being used.
The latter relies on new investors continuously investing in financial products. This is necessary for the promised return to be paid out. However, as soon as investments fail to materialise, the system collapses.
Telegram Stock Group: Crypto Tokens
In a Telegram Stock Group, scammers not only promote crypto coins, but also their own crypto tokens. The crucial difference between the two is that a blockchain already exists for the latter. For crypto-coins, the code for the blockchain has to be written first.
Telegram Stock Group: We explain how dangerous investments in crypto tokens are using Squid game tokens.
- Squid Game Tokens is a cryptocurrency that has been sold since October 2021 in reference to the Netflix series of the same name.
- After only two weeks, there was already an increase in value from 0.01 dollars to 2856 dollars. This corresponds to 28,558,900 per cent.
- Due to the exorbitant increase in value, investors increasingly invested in crypto tokens.
- But after the peak was reached, there was a rapid loss in value.
- In the meantime, the Squid Game token is only worth 0.003 dollars.
- It stands to reason that the fraudsters used rug pull – a scam. In this context, they presumably exchanged huge token holdings for fiat money.
Experts assume that the scammers were able to make a profit of about 3 million dollars. Currently, it is not possible to sell the Squid Game token at Pancakeswap.
Telegram Stock Group: Telegram Crypto Scam
According to news service Bloomberg, users of Reddit’s r/WallStreetBets – r/WSB – have lost about 3,400 Binance Coins, or about $2 million. This is a platform where interested investors can exchange information about options and stock trading.
To realise the fraud, the mastermind used Telegram. In this section, you will learn how the crypto fraud actually took place.
- A WallStreetBets Crypto Pumps account was used for the scam.
- The mastermind advertised on Telegram for investments in the fake cryptocurrency WSB Finance. He also offered interested investors a private pre-sale.
- In this context, he promised Telegram users that they would receive thousands of WSB FINANCE coins in exchange for Binance coins and Etherum.
- In order to make these investments, Telegram users were sent an invitation that included a link to the wallet. By this, you imagine a virtual wallet where Coins can be both received and issued.
- Immediately after receiving the coins, the scammer informed investors that the exchange bot reported an error. According to the error message, investors would have to send more BNB Coins. Otherwise, they would lose their investment completely.
- Only a short time later after this message, 3451 BNB Coins were taken from the wallet. Currently, the value of the 3451 coins is about 2 million dollars.
- It is uncertain how many coins the mastermind stole beyond the amount mentioned.
Be it for real estate, cars or fancy watches: In Telegram Stock Groups, scammers offer loans for products of all kinds. While the interest rates would be around 2 %, loan volumes of up to € 700,000 are possible. It is striking that the credit brokers do without credit checks and Schufa information.
They only want to know by when the loans can be repaid in full.
Telegram Stock Group: Consult a lawyer!
Have you been deprived of your assets by a crypto fraudster? Have you had to accept large losses through investments in dubious financial products? Or are you unsure and want to know more about the risks of a Telegram Stock Group?
The lawyers of the Herfurtner law firm will explain to you in a consultation what you need to watch out for and which investments are not advisable.