A dump is the act of rapidly selling a large amount of cryptocurrency, often done by a whale. This selling spree can result in a decrease in the price of the asset.
The term is commonly associated with pump and dump schemes, which are typically connected to fraudulent activities aimed at artificially manipulating the price of a cryptocurrency.
However, a dump can also refer to the quick disposal of one’s own cryptocurrency holdings in order to generate immediate profit.
An instance of a well-known dump and its consequences occurred in December 2017 when Charlie Lee, the founder of Litecoin, sold a significant amount of LTC. This action raised concerns about a potential conflict of interest.
Initially, the markets did not exhibit much reaction to this event. However, within a few days, LTC experienced a substantial decline in value, losing almost half of its value. It took several weeks for the cryptocurrency to recover from this loss.
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