Concentration / Pump Risk

Threshold table

Cutpoints map onto DOJ horizontal-merger guideline categories: 0.25 = unconcentrated / moderately concentrated boundary; 0.50 = moderately / highly concentrated boundary; 0.75 = a single dominant participant accounts for roughly three-quarters or more of activity.

Concentration category	Min HHI	Markets flagged	Share of eligible	Participations in flagged markets
Moderately concentrated +	0.25	2,331	1.0%	788,122
Highly concentrated	0.50	30	0.0%	1,960
Single-trader dominated	0.75	0	0.0%	0

HHI distribution across eligible markets

HHI bin	Markets	Share of eligible	Participations
[0.0, 0.1)	202,566	88.2%	537,151,126
[0.1, 0.2)	22,798	9.9%	9,541,238
[0.2, 0.3)	3,068	1.3%	1,022,784
[0.3, 0.4)	987	0.4%	295,822
[0.4, 0.5)	322	0.1%	135,818
[0.5, 0.6)	30	0.0%	1,960

Top 20 markets by HHI (material activity only)

Markets ranked by HHI, restricted to those with at least 100 matches (200 participations) so sparse-activity markets with mechanical HHI = 1 are excluded. The top markets are dominated by niche sports spreads, single-game lines, and short-window crypto-price markets — settings where a market-making bot provides essentially all the 2-sided liquidity because the audience is small. The top-wallet share clusters near 50 percent, the structural signature of a single MM that rests one side of the book at all times rather than a single trader pushing the price.

Market	Market ID	Total participations	Distinct wallets	HHI	Top-wallet share
Valorant: Nobles vs yung - Map 1 Winner	1297729	1,022	3	0.498	49.9%
Set Handicap: Juvan (-1.5) vs Bertea (+1.5)	1305375	568	3	0.493	50.0%
Will the price of Ethereum be above $3,600 on October 7?	618093	602	10	0.484	49.2%
1H Spread: Clippers (-0.5)	1300622	4,936	13	0.473	49.8%
Pistons vs. Suns: O/U 215.5	1287901	2,774	31	0.472	48.6%
Spread: Mercyhurst Lakers (-3.5)	1308902	540	10	0.471	49.3%
Ethereum Up or Down - January 23, 11:00PM-11:15PM ET	1246323	378	14	0.469	50.0%
Predators vs. Islanders: O/U 6.5	1308633	1,746	28	0.469	48.9%
1H Spread: Jazz (-2.5)	1300617	6,510	12	0.465	49.9%
Set Handicap: Danilovic (-1.5) vs Bulgaru (+1.5)	1305391	1,216	15	0.465	48.4%
Will the price of Solana be less than $170 on October 6?	617081	376	13	0.464	48.4%
Lanka Premier League: Kandy Falcons vs Colombo Strikers (Game 1)	694236	688	17	0.463	48.4%
Spread: Tigers (-1.5)	584251	298	10	0.461	48.0%
Will fewer than 10 albums be ranked #1 on the Billboard 200 in 2026?	1131203	2,028	34	0.454	47.7%
Will the price of XRP be between $2.97 and $3.00 on September 21 at 4PM ET?	606553	364	8	0.453	49.2%
Spread: George Washington Revolutionaries (-12.5)	1307050	638	19	0.451	48.0%
Southeast Missouri State Redhawks vs. Eastern Illinois Panthers: O/U 138.5	1304494	862	16	0.450	48.0%
Miami vs. Texas A&M: 1H Moneyline	941331	5,996	34	0.450	47.4%
Tjen vs. Joint: Total Sets O/U 2.5	1308962	922	9	0.449	49.0%
Pistons vs. Suns: O/U 214.5	1287899	1,442	42	0.449	47.4%

Methodology

For each market, compute each wallet's share of total participation events (each match contributes one event for the maker and one for the taker). HHI = sum(share^2). Threshold cutpoints 0.25 / 0.50 / 0.75 map onto the DOJ horizontal-merger-guideline categories (unconcentrated, moderately concentrated, highly concentrated). Markets with fewer than 20 matches (=40 participations) are excluded to avoid trivial HHI=1 from sparse activity. Material-activity top-markets table requires >=100 matches.

Interpretation

A high HHI does not establish manipulation. It establishes that one trader had enough presence in a market to move the consensus price unilaterally. Three classes of wallet typically generate high HHI: (a) the venue operator's bootstrap wallet seeding early liquidity (common for sparse-activity markets), (b) an algorithmic market maker that crowded out other liquidity providers in a particular contract, (c) a single trader who took a large directional position and held it across many small fills. Only (c) is the classical pump-risk pattern. Discriminating among the three requires per-wallet behavioral profiling that is outside the scope of this index.

The metric is reported as "patterns consistent with single-trader price control," consistent with the rest of the surveillance suite's posture rules.

Limitations

• High HHI is necessary but not sufficient for single-trader price manipulation. A market with HHI = 1.0 (one wallet on both sides of every match) might be a venue-operator test market, an early-launch bootstrap, a tiny niche market with one dedicated trader, or actual manipulation.
• Algorithmic market makers can drive a single market's HHI above 0.5 simply by providing most of the liquidity. The flag is on the market structure, not on the intent of the dominant wallet.
• The HHI here is on participation count, not dollar volume. A wallet that places many small trades will weigh more in HHI than a wallet that places a few large trades. A volume-weighted variant is a candidate v2 refinement.

Source

The HHI is computed from on-chain participation counts per market. No external benchmark or market-specific assumption is required. This index is original to the DV-PMI surveillance suite; the closest economic analog is the DOJ horizontal-merger-guideline application of HHI to market structure.

Data

surveillance_concentration_latest.json · surveillance_concentration_top_markets.csv

Other surveillance indices

← All surveillance indices · Informed Trading (PII) · Insider Timing · Adverse Selection · Resolution Surprise · Wash Trading

Cite this index

@misc{dellavedova2026concentration,
  title        = {Concentration / Pump Risk Index},
  author       = {Della Vedova, Joshua},
  year         = {2026},
  url          = {https://jdellavedova.com/surveillance/concentration}
}