September 13, 2021, will forever be marked as the day of one of the fastest pumps & dumps in the history of the cryptocurrency world. It all started from fake news pushed by Globe Newswire that was distributed by all the most famous media platforms in the world of finance such as Bloomberg or Reuters:
CNBC then came along and added fuel to the fire with a tweet and a full article on Wallmart’s alleged announcement of support for Litecoin payments starting in early October 2021 :
This hit the cryptocurrency world like a bomb yesterday. That’s all it took for some influencers to start fuming on Twitter saying that old cryptocurrencies never die.
This market manipulation saw all stops up liquidated in a matter of minutes which caused Litecoin’s price to jump over 30%:
Wallmart’s official denial took about 30 minutes which then caused the big dump with the Litecoin price returning to the initial point around $180. All stops down were then liquidated.
At the same time, Bitcoin and Ethereum saw their prices jump. The whole market was excited about this announcement. Of course, all these cryptocurrencies fell quickly once the real news was known to all: it was just a market manipulation.
This episode of the Litecoin Fake News is here to remind you of two key lessons in my opinion.
The first lesson is always the same: “Don’t Trust, Verify”.
Be critical when you see news appear on Twitter or in the media. Be suspicious. Ask yourself if it makes sense then wait for more information. Don’t give in to the prevailing FOMO. My first reaction was to wonder why Wallmart would choose Litecoin over Bitcoin and the Lightning Network.
From there, I immediately sensed the market manipulation and preferred to stay back and wait. The wait was not long as the fake news was announced in less than an hour. But some people, who deleted their tweets from now on, showed that they had a problem applying this rule.
Even big media like CNBC fell into the trap. Well, the trap is an exaggerated word, since we could go as far as imagining a deal between Wall Street and the media to manipulate the markets. This would unfortunately not be the first time.
The victim? It’s the retail investors, as always.
This is where my second lesson comes in. Don’t try to time the market. Understand that your natural advantage is the time you are willing to spend in the market. Time in the market always beats timing the market. This is a golden rule.
The best way to protect yourself from these market manipulations of Wall Street and the Whales is to take the long view. Don’t buy Bitcoin or Litecoin, or whatever Altcoin you can think of, based on a FOMO news story like this.
Invest your money by weighing the pros and cons. Take the long view and then keep your emotions in control. If you think Litecoin has a great future, that’s right. But only invest in LTC if you have that long-term vision, not because some fake news is spreading on social networks.
This is probably the hardest thing to do in the cryptocurrency world. Yet it is a necessity to avoid losing money. Hopefully, this lightning-fast market manipulation will remind you of this essential truth and allow you to be warier next time.
Always keep your emotions under control and check all information with a critical eye. This is what Bitcoin is constantly teaching us.