Research: PlusToken Crypto Scam Could Be the Reason for Bitcoin’s Plunge

PlusToken crypto scam

While price fluctuations is very common in the crypto sphere, some analysts have reasons to believe that the recent plunge in the Bitcoin price isn’t just like any other decline. The researchers of Chainalysis believe it could very well be the aftereffect of the PlusToken scam.

You will recall that a crypto Ponzi scheme disguised as a crypto venture with the name PlusToken was uncovered lately as AllStocks Crypto News reported. Since the ‘big reveal,’ a ton of findings have surfaced linking the scheme with the highs and lows in Bitcoin’s price curve lately.

Adding to the list of findings that show PlusToken is responsible for the bear and bull market so far, Chainalysis released an insightful analysis that shows the coast is not clear yet. Bitcoin’s price could very well continue to plunge if the wily actors involved decide to cash out the remaining BTC in their wallet.

As at the time of compiling this article, 20,000 BTC (about $132 million) are yet lying wait in the fraudsters’ wallets – more than 8,700 wallets to be precise. The other part of the looted 45,000 BTC has already moved through crypto exchanges and over-the-counter (OTC) brokers and it is feared to be a major influence on Bitcoin price so far.

Chainalysis writes:

“The cashouts likely caused increased volatility in one of two ways. They either cause it directly by increasing the supply of Bitcoin and changing market dynamics, or indirectly by affecting traders’ perception of the market.”

Even after the six arrests linked to the PlusToken scam made in June, we have reasons to believe some of the nefarious players are still at large as the stolen funds have continued to move through wallets to OTC brokers. Worse, it is difficult to track this movement as the criminals are using ‘mixers’ to cover their tracks. In addition to that, OTC brokers are not held to the same know your customer (KYC) rules as cryptocurrency exchanges, making it difficult to track sales. No wonder these criminals often utilize OTC brokers.

Although tracking the funds seems impossible, researchers at Chainalysis were able to prove beyond a doubt that the time of the cashouts coincides with the different plunges in Bitcoin’s price so far. Tracking Bitcoin’s price from April through December 2019, Chainalysis was able to account for the various spikes and falls.

“PlusToken wallets sent a steady flow of Bitcoin starting in mid-April and spiking just before the arrests in late June. After that, we see no movement until a few spikes in August, before transfers spike again and remain high throughout September. Then, we see a few more spikes in October.”

Seeking Explanations for Bitcoin’s Decline in the Second Half of 2019

Compared to last year, you would agree that this year has been great so far for the crypto community and Bitcoin(BTC)trade. Rising from way below $3,000 to well over the $10,000 benchmark (and now trading at around $6,600), anyone could conclude that it is overall a good time to be a crypto fan.

Unfortunately, the continued plunge experienced in the latter part of the year is also making it a difficult time in the crypto sphere. With such a good start, analysts and experts are trying to determine what could be the reason for this sudden, prolonged price decline.

This is the one-million-Bitcoin question that experts are yet struggling to answer, and the PlusToken scam could offer at least some partial answer

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