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- Matic drops 70% in an hour after weeks of positive gains.
- The cryptocurrency was up nearly 200% in two weeks before the plunge.
- Was it an inside job?
Matic — one of the first tokens to originate upon Binance Launchpad has witnessed one of the harshest dumps in crypto history, falling a massive 66% in the space of an hour.
Crypto, Twitter is screaming today. Altcoins left, right, and center are dropping like stones. Still, one cryptocurrency is hurting more than any other, Matic.
On December 10, the cryptocurrency — which has an impressive price history — plummeted from its all-time high of $0.042 to a low of $0.011.
Ironically, Matic was on a slow and steady incline in the weeks prior to this, climbing 180% to its price peak. This latest dump has undoubtedly left some investors ruined.
What Pushed Matic to Fall?
There doesn’t appear to be any fundamental reason for the drop. As such, many have called out the project founders for dumping their tokens on the market. One user highlighted over 1.4 billion Matic tokens, which had been allegedly transferred to Binance in the past few months — an apparent attempt to dump the tokens at the ATH.
Your #matic masters dumped on you. https://t.co/cZE9FZgtVr
— I am Nomad (@IamNomad) December 10, 2019
However, this figure was later deflated by Ethereum dev, Eric Conner, who revealed that it was 290 million Matic sent to binance, rather than 1.4 billion — a significant difference when it comes to dumping on the market.
It's disgraceful that people take random tweets as gospel in an attempt to destroy a project (@maticnetwork in this case).
The actual truth is, in the past 50 days, they have moved ~290,000,000 MATIC to Binance NOT 1,495,322,715. https://t.co/f2Nt3zJZyi
— eric.eth (@econoar) December 10, 2019
Reacting to what he dubbed “FUD,” Matic’s COO, Sandeep Nailwal, pleaded innocence, noting that the truth would come out sooner rather than later:
Just woke up to this nightmare due to a distress call by someone It will be clear very shortly that we are not behind this, as some FUD accounts are trying to insinuate We will post a detailed analysis and we will come out stronger than ever from this evident manipulation
Responding to this — clearly attempting to defend the Binance launched token — Changpeng “CZ” Zhao jumped into the fray, clearing Matic’s name. The Binance boss promised an investigation into the data, adding that so far, it appears that the project team wasn’t involved.
Instead, CZ suggested that it was simply a consequence of panicked traders selling in waves and causing a domino effect.
Inside Job or Sheer Panic?
Nevertheless, not everyone bought the story at face value. Popular crypto Twitter personality, @IAmNomad, refuted Matic/Binance’s claims, referring to the aforementioned transfer of funds. Providing evidence Nomad posted a picture of the Matic group chat in which Nailwal highlighted Matic’s recent “unlock/release schedule.” Nomad added that that the total liquidated from the release schedule equaled the total sold today.
Another crypto trader, Nick Core, agreed with Nomad, asserting that CZ’s explanation left a lot to be desired:
This narrative that a number of big traders panicked is absolute horshit. I respectfully encourage you to show some kind of data that at least suggests this. I am certain that if some time was spent studying the public data on that sell off a different conclusion would be drawn.
Other analysts concurred that things didn’t quite add up.
Just look at the god damn chart and tell me this is not an insider job.
A big pile of inorganic 💩. https://t.co/MAusVJMc0O
— The Crypto Monk ⛩ (@thecryptomonk) December 10, 2019
Although, somewhat backing up CZ’s claims is Matic’s illiquidity. Sam Bankman-Fried, CEO of FTX, believes that due to the relatively small size of the market, Matic could have plunged with “a few people” selling a lot.
This could corroborate CZ’s narrative of panicked sellers, causing an exaggerated decline. Although coupled with the fact that Matic liquidated 3% of the total supply to binance before the dump, it still doesn’t look great.
As for whether this was an inside job remains to be seen. As for now, heavy scrutiny from the community remains fixed on the project and its founders.