Matic Price Drop Looks Like Binance’s Inside Job, Researchers Say

Matic price drop massively impacts the markets, causing traders panic and raising questions regarding CZ’s statements.

The Matic token was rising steadily during a two weeks long period and people were buying it without thinking of the possible massive price drop. However, as Coinspeaker has already reported, it happened. The project seemed successful from the start, and the investors who bought large amounts must be shocked right now. As their investments vanished and the Matic’s official response is kind of shady.

According to the chart, some whales dumped large amounts of Matic tokens causing the 70% price drop. After the accident, Binance‘s CZ is giving a short statement on Twitter claiming that it must be the whales who became scared and sold the stack in a few minutes.

What Happened on Binance at Night?

Eastern traders discuss the dump in their private Telegram channels. Coinspeaker’s gonzo crew is spying to bring the most relevant opinions to you, for free. According to the sources, “during the last night trades on Binance market maker bots were disabled on MATIC”, the bids and the tough orders 10 to 20 BTC were removed too. There was only organic volume left, occasionally touching the 2 BTC level. It is said:

“Starting from 515 satoshis, someone has started one-hour long selling. Then, there was an hour of flat, the trader took some rest, and then they bombed the market with sell orders adding 10-20% per every 5 minutes of trading. Since there were no buy orders, the price fell and the “panic sell” session ended on 155 satoshis level. Such a scenario is not something very rare, we’ve seen it lots of times with XVG (after the partnership with PornHub) and OCN (on Huobi).”

Anonymous Whales Manipulate Matic Markets

So what we observe in recent Matic trading can be called a manipulation. Some anonymous party is dumping a hilarious stack of IEO tokens via Binance and the exchange is doing absolutely nothing to stop the ultimate downtrend. Some already call the incident a play against the principles.

Specifically, Binance’s CZ told the public during a Moscow crypto meetup that the exchange can freeze user’s funds if it suspects illicit activity, money laundering, fraud, pump’n’dumpery and other such pursuits. Their monitoring department is working 24/7, according to CZ. So, when the Matic price dump started, why didn’t the exchange freeze trades and withdrawals till the picture becomes more clear?

The Rules of the Market Maker

  • The first rule: Market Maker should have a supply equaling to more than 35% of the money that is currently in circulation. This is needed to stop any panic sell that may occur, and to minimize the costs of price manipulation.
  • The second rule: you must know well the large holders of a specific token.
  • The third rule: do not allow the circulating supply to concentrate in one person’s hands, far from your control.
  • The fourth rule: contact the exchange as soon as something fishy is going on, and solve the problem together, whether it’s a hack or the unplanned dump by the whales.

The Matic Token Is Dumped according to a Specific Scheme

After the scheme was tested enough on Matic, the mysterious market player has started doing the same stuff with ONE, FET, RVN and some other tokens which were a massive part of Binance’s portfolio. All the market was down thanks to the dump: the panic sell spreads among weak traders. During the price fall, there were no moves on the BTC market and no significant news.

Not a single Market Maker will believe that Binance or the token’s team has no connection with such a blatant dump. The outcomes are scary and increase wisdom: Binance wants to openly play against its clients, joining the club where Huobi, Yobit, HitBTC, BitMax, and other opaque exchanges are sitting for years so far.

The official response by CZ is weak, claiming big traders caused the panic sell. This is something hard to believe, and the official team is saying they have no idea what happened.

Altcoin News, Binance, Bitcoin News, Blockchain, Cryptocurrency news

Author: Jeff Fawkes

Jeff Fawkes is a seasoned investment professional and a crypto analyst. He has a dual degree in Business Administration and Creative Writing and is passionate when it comes to how technology impacts our society.

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