Crypto pump-and-dumpers trick CoinDesk with fake Grayscale filing

This is the memo CoinDesk should've read before publishing its report on a new Grayscale filing.

Crypto’s pesky pump-and-dumpers are at it again. This time, they’re duping digital asset investors with dodgy Grayscale filings, CoinDesk has reported.

The outlet shared news on Tuesday that indicated Grayscale — the world’s largest crypto fund — had filed to register a new trust for the effectively unknown Ethereum scaling project Nahmii.

CoinDesk’s article detailed how an entity calling itself “Grayscale” made the filing in exactly the same way the real Grayscale Investments has previously done for dozens of cryptocurrencies over the years.

The filing for Nahmii (with one i) on the left is fake. The one on the right is for the very real Grayscale Bitcoin Trust.

Given Grayscale’s ability to attract money (it currently manages $45 billion in crypto), this would have been quite the coup for the obscure token. Nahmii boasted an estimated market cap (fully-diluted) of around $92 million at the time.

Unfortunately for Nahmii (and CoinDesk), no sooner had the story hit the web than Grayscale chief exec Michael Sonnenshein and Nahmii representatives took to Twitter to shoot it down.

CoinDesk subsequently amended its original story and followed up with another piece, setting the record straight. The outlet suggested it could have been a mysterious imposter using Grayscale’s name to drive up Nahmii’s price.

This is factually inaccurate. As described in our Feb 26 blog post, we have and will maintain a list of assets which we are potentially exploring for inclusion in our family of products. 👇https://t.co/rd4FD0Ljk4 https://t.co/81C83MMHPS
— Michael Sonnenshein (@Sonnenshein) April 6, 2021

CoinDesk is hooked, now reel in the apes

Sadly, it looks like there may be something to the pump-and-dumper’s approach.

The token rose up to 700% in the 10 days before the article went live, but CoinGecko reported Nahmii’s value more than doubled to $0.01 on the day of CoinDesk’s report, and its daily trading volume jumped over 2,400% to near $13 million.

At time of publication, the token’s price had dropped to just over $0.007 — down 40% from its new record high.

CoinDesk’s article went live about half way up.

The erroneous Grayscale filing isn’t the first dodgy lead to sneak past CoinDesk’s bullshit detector — but this one’s particularly puzzling as the outlet and Grayscale share an owner in Barry Silbert’s Digital Currency Group.

In September 2019, the outlet was the victim of a hoax that saw pranksters pose as Kik’s Ted Livingston in the midst of the failed messaging app’s battle with the SEC.

Edit 17:46, Apr 8: Numbers updated in the 9th paragraph.