Firstly, "Pump & Dump" schemes are illegal based on securities laws. So if you're in a country where coins are considered a security, you could land yourself in legal trouble.
There's two possible outcomes:
- You lose money. This is bad for you no matter what.
- You gain money. This is good for you, but remember that for every dollar you gained from the scheme, someone else lost a dollar.
While someone is always winning or losing in the markets, the big difference is that a P&D scheme involves intentional deceit. If you're actively promoting false information or lying to people in order to make a profit, that basically amounts to theft.
Would you break into someone's house to steal their money? No?
Then why would you lie to someone to steal their money?
Illegal? I thought crypto is not regulated.
Depends on your location.
Some jurisdictions regulate cryptocurrencies as a security, in which case this scheme is illegal.
The regulation of cryptocurrency is also changing very rapidly, and it's possible that any government could increase regulation at any time, as well as investigate previous crimes and illegal activities if they were substantial enough.