Price Manipulation

Always check the token distribution if you don't want to become the exit liquidity.

How It Works:

• Developers or their collaborators act as "whales," holding a significant portion of the early token supply. This is also apparent in many Solana meme launches. While it is not evident that the token will be rugged if developers and their insiders hold a large portion of the supply, you should always take care with "cabal plays."

• They artificially inflate the price through coordinated buy-and-sell actions, creating a false sense of demand.

• Once the price peaks and attracts enough buyers, they dump their holdings, causing the price to plummet.

How to Spot It:

• Token Distribution: Check the token distribution on blockchain explorers. A healthy project should have a wide distribution, with no single wallet holding an overwhelming percentage. Bubblemaps is a good alternative for checking connected wallets.

• Unusual Volume Spikes: Sudden and unexplained trading volume surges could signal manipulation.

• Fresh Wallet Accumulation: There is no perfect solution to spot if owners hold a large chunk of the supply because oftentimes, they accumulate through several practically unconnected wallets. For example, they send funds from CEXs to different wallets and buy using them, making the connection between them hardly visible. Always check when they were funded and from where, and you can decide whether they are connected or not (e.g., 5 fresh wallets funded from Binance on the same day buying means a high chance of insider accumulation).