Economy 101, the market is ruled by the forces of demand and supply. What does this have to do with shilling in crypto? Since the supply of cryptocurrencies is limited, their value will almost entirely depend on their demand. Now, imagine you have a finite supply, and ever-increasing demand – the prices obviously shoot through the roof. And this is the primary goal of shilling in crypto – drum up demand for a crypto coin or token with the sole purpose of inflating its price. You’ve definitely heard of pump and dump schemes; these tend to be direct results of shilling.
What is Shilling in Crypto?
Crypto shilling is an active and usually exaggerated advertising campaign by celebrities, founders, social media influencers, or enthusiastic marketers trying to promote a crypto project. The primary goal of crypto shilling is to create hype around particular crypto and drive up demand from the public resulting in mass buying. It’s a simple equation really, the more people invest, the higher the demand for the token, and the higher the price goes. And usually, the shills with vested interest cash out at higher prices before everything comes crashing, leaving the unsuspecting public with worthless coins.
To fully answer the question ‘what is shilling in crypto?’ let’s get some background on how the crypto market tends to be run by fear and greed. Market sentiment – specifically FOMO and FUD – drives the crypto market. And crypto shills have mastered the art of playing to these emotions.
Anything goes when it comes to crypto shilling. The shills are usually creative with absurd claims such as “get in on the ground floor before we go to the moon”, “buy the dip”, “buy the most undervalued crypto”, “get in on an exciting project” etc. It’s all about deliberate hyperbole. It’s the art of making exaggerated promises about the potential returns from investing in a particular project or buying a specific token. And the language here can vary, but They are designed to fuel delusions of quick riches.
While in some cases crypto shilling can just be project founders and employees promoting their projects enthusiastically, there are many instances where crypto shilling is used by individuals with vested interests to pump the price of worthless cryptos or rug pull schemes. One of the most recent famous instances is the EthereumMax scandal where investors sued the crypto shills involved, including Kim Kardashian and Floyd Mayweather.
How to Avoid Crypto Shilling
Avoiding crypto shilling is surprisingly simple. Rigorous due diligence. Don’t just throw your money at something without knowing its ins and outs.