Fake Coins and Wash Trading on BitShares
A feeble attempt to strike back and expose the scammers...
One of the disadvantagous to being an open source block chain project that anyone can participate in is that there is no way to keep the bad people out.
I wanted to follow up on my prior post,
https://steemit.com/bitshares/@cryptick/how-to-get-scam-coins-out-of-your-bitshares-account
and point out that I have in one small way been successful. Both Bitshares accounts
donotbuy1
or
fakecoin1
have gotten some transfers and in some cases are now showing up as a top holder of scam assets.
Lets take a look at the fake coin Neutron.
https://www.cryptofresh.com/a/NEUTRON
The chart looks pretty abysmal.
https://wallet.bitshares.org/#/market/NEUTRON_BTS
There does appear to be some orders in the order book.
But then when you take a look at the who those orders are by.
https://www.cryptofresh.com/a/NEUTRON
It becomes apparent that they are all by the same couple of accounts.
And both if you look at the top holders of the accounts you see this…
https://www.cryptofresh.com/a/NEUTRON
You will note that that donotbuy1 is the #4 holder of this coin. You will note that fakecoin1 is the number 5 holder of this scam fake coin. There is another account trash-box that looks like it has been used in a similar way as well. None of these account names should inspire confidence in a coin. In fact, if should be fairly obvious to anyone looking at this like, um…. Wait a minute, God gifted me with a Brain, Why in the world would donotbuy1 or Fakecoin1 be key holders of an asset. Maybe I should google that. And hopefully you got here.
Now one might note that the number 6,7 and 8 holders of the coin all have .0001. Well this has been sent out to 247 total accounts. So all of the rest of these accounts have been given just a small fraction of a coin. It makes the numbers look bigger on distribution. In my experience, these accounts send out coins to every account that trades or places an order. If you have accounts that are very active they are also likely to get the coins. I think some of the scammers also just use an alphabetical list of accounts and send these coins out to a bunch of accounts.
Most of what I have figured out, has been my own ideas, observations and thoughts. I do not claim to be an expert, so if I am mistaken, please share in the comments below.
Do I think transferring fake assets is going to be effective at stopping this? Honestly, I don’t. Do I think writing about it is going to cause people to rise up and stop it or greatly increase attention? No. Do I think I am going to change the world or increase awareness? No. Mostly, this was a something I could do. It was one small act to strike back at hordes of evil.
These scammers do wash trading in the accounts.
What is the purpose of trading against oneself. It creates volume and makes the coin look more popular than it is.
Another popular method is to trade back and forth between two different account run by the same person.
This makes fake volume.
And then on a weekend they can trade a whole bunch, making a coin appear really popular. Of course if you stop and think about it if you are trading back and forth between accounts you can even change the price to make any type of chart that you want. So you trade some a 10, some at 12 some at 15 some at 10 some at 12 and now there is a nice looking chart.
Look Folks There is good people in the world and there are bad people in the world.
There is right and there is wrong.
Wash trading is wrong.
https://en.wikipedia.org/wiki/Wash_trade
I know not everyone has the same morals and the Chinese have even turned it into a sport with one exchange offering prizes to the account which traded the most of a newly released security. I have made plenty of jokes about Chinese accounting in the past, but prizes for cooking the books brings up up to a whole new level. What is the next the olympics of cooking the books?
I believe in the potential of block chain, but these scams are annoying and detracting from the potential of the industry. I do not think it is morally right for those of us who know better to stick our heads in the sand while people -particularly new crypto currency traders- are scammed and ripped off. And remember, it is not just those of us who are native English speakers in these markets, many people for who English is a second or third language also trade cryptocurrencies. They cannot detect all of the tell tale scam signs -like bad English- as well as you can.
I challenge you block chain enthusiasts who own coins and have some morals, lets rise up, get rid of some of the scams. We will be rewarded with higher values of real coins, that have the potential to make the kind of world we all want.
Lets change the world, but do it for the better.
So I have been thinking about this, and I still have a few more ideas. A good detective looks at everything and thinks about everything critically. There can be a lot of evidence in the very small details. This is what makes it easy for people to sometimes detect a lie; you look for the smallest clues, you ask questions you already know the answer too and you see how people respond and what they do. You then use this information in order further evaluate evidence. I would like to point out that sometime clues are left in very small ways, sometimes very blatant ways. It should also be pointed out that numbers have meanings. If I say the answer to everything is 42, this references an Douglas Adams movie, if I am concerned about a 1984 government, this references a famous book about communism. If you have gone to church, you know the devil, the great deceiver, has a mark on his head of 666. On the internet, 404 is a common error, meaning not found. One might reference 90210, a zip code of a movie, or 867-5309 a phone number made famous in a TV show. Among truckers, 10-4. has a meaning. In the bible 7 is perfect. We also live in an international world, in China, 8 means complete. One could go one, but sometimes a number is not just a number.