Decompose Market Manipulation Strategies: Evidence from On-chain Meme Coin Market

Abstract

This study unravels how different market manipulation strategies affect meme coin project performance and participant profits. Using a clean and observable on-chain setting on the meme coin platform Pumpfun, we collect granular on-chain transaction data and off-chain comment data for 6,000 meme coins and analyze the heterogeneous effects of rat (concealed accumulation/front-running), sniper (concealed accumulation/front-running), wash trading (fabricated activity), and comment bots (fabricated sentiment). Creators or snipers profit from concealed low-cost accumulation; attention manipulation, such as wash trading and fake comments, could effectively attract more traders and affect wealth redistribution. Avoiding manipulation and often timing the dump in early-stage projects, outperformers are disproportionately creators/snipers; underperformers are loss-sensitive and learn little from their past trading. Overall, our findings show how inventory concentration and attention fabrication drive participation, timing, and wealth redistribution. These insights inform transparency and anti-manipulation policy in both crypto and traditional financial markets to better protect innocent traders.