Market Manipulation in Cryptocurrency Markets and the Amplifying Role of Social Media

Abstract

The cryptocurrency market represents a decentralized, 24/7 arena that is to a great measure free from regulatory constraints. Although this favors innovation and inclusion, it puts the market in a very vulnerable place due to manipulations with the help of technology. Social media increasingly shapes flows of information and sentiment, disrupting crypto price dynamics. This chapter will review market manipulation in crypto and how social media fuels speculative activity. Manipulation types to be covered include pump-and-dump, wash sales, spoofing, and DeFi-related manipulation. These concepts have been integrated with the author's work on behavioral finance, market microstructure, and blockchain research.