After receiving attention from Nubank customers in recent days, the nucoin can be targeted by groups of pump and dump on the social networks. It is not clear if this is the reason why the digital bank restricted trading of the digital currency last weekend.
With a possible restriction, customers can now only buy and sell Nucoin for R$49,000 per day, according to a customer in the bank’s community. Nubank’s cryptocurrency, it is worth remembering, is only available on the digital bank’s own platform and is not traded in brokers.
the blows of pump and dump usually occur when communities of investors combine to buy a particular cryptocurrency at the same time, artificially inflating the price of the digital currency, creating a “pump”.
Shortly after the purchases, the sales of those who bought first begin, causing prices to fall or referred to as a “dump”. Since those who bought first and turned a quick profit tend to dump the sardines that arrive later, the practice is viewed as a coup by investors.
It is worth remembering that in the traditional stock market, driving up asset prices is a criminal practice. For example, one of the most recent cases in the US industry concerns the actions of GameStop, when the Reddit group WallStreetBets drove up the share price and the US government launched an investigation into the matter.
Nubank restricts Nucoin cryptocurrency trading after detecting fraudulent schemes
The Nucoin fever erupted in recent days as the Nubank cryptocurrency experienced a rapid market rally, reaching a 30-day high of a whopping 1,939%.
Amid high demand from investors, Nubank suspended operations and told the live coins that the situation arose due to high demand for the service. Last Monday (14) the problem was solved.
However, there is a rumor among banking clients that pump and dump groups are manipulating the price of the Nucoin cryptocurrency. That is, they buy and sell the currency, which causes the recent instability on the platform.
While some in the Nubank community believe the problem is real, others argue that the lack of evidence does not favor the theory. According to a customer, Nubank also started restricting daily buying and selling to avoid new problems and volatility in the price of its cryptocurrency.
Despite customer rumors, Nubank itself has not publicly confirmed the information.
Trading suspensions are foreseen in the rules of the Nucoin loyalty program in case of high volatility
The Nucoin Program Rules, last amended on August 3, 2023, specify what customers can and cannot do.
In two topics examined by the report of the live coinsis it clear that Nubank can suspend trading in case of high Nucoin volatility.
“Trade suspension. To ensure that participants’ orders are not executed against their disadvantage during a period of Nucoin supply and demand mismatch, Nubank may suspend Nucoin trading if abnormal volatility is detected on any given day. Once market conditions normalize, you can place your orders again. Suspension will be communicated through the app and orders received prior to such notice will be processed normally.
Despite the prediction that it could suspend trading in Nucoin, Nubank clarifies that participants in the bank’s loyalty program will protect their funds in the event of product suspension, cancellation or change.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
