PlusToken recently moved around $186 million worth of Ethereum and now investors fear Ethereum price sell-off and a dump in the ETH price. As the cryptocurrency news now show, PlusToken is one of the largest scams in the crypto world and earlier this week, the project tried to move 789,500 in Ether (ETH) but the movement of these stolen funds were temporarily held up by congestion issues within the Ethereum network.
Therefore, the $186 million transfer came from a known Ethereum address and was later split into 50 different transactions, mainly as an attempt to disguise the activity. Whale Alert spotted these transactions which have since been processed but little information on the funds’ destination has been reported.
For those of you not following our news, PlusToken was a project that was dismantled last year. However, it is still causing damage to the crypto industry by liquidating holdings and holding large amounts of Bitcoin (BTC) as well as assets like Ether (ETH) and EOS.
The project still holds a significant amount of stolen crypto assets and these funds are still a major threat to spot markets as large market sales can impact the prices of Bitcoin and Ethereum. Investors fear a potential sell-off on the markets, and some even believe that the March 12 crash was in fact caused by PlusToken dumping Bitcoin on spot markets. The theory, however, was later dispelled by the blockchain analytics firm Chainalysis.
As Chainalysis noted, the BTC movements from PlusToken to exchanges slowed down heavily before the Black Thursday crash, which showed that the two events were not correlated. However, investors fear that something similar could happen soon if the PlusToken scam activates more sales.
The danger of an accentuated drop caused by a large sell-off becomes bigger and could potentially trigger a long squeeze for Ether. Analysts from Chainalysis agreed to this and said that large inflows can definitely increase the price volatility on exchanges.
This problem can potentially be exacerbated by trading bots that pick up on those on-chain movements and execute trades, not to mention the highly leveraged positions on derivatives exchanges that can get liquidated rather quickly. But overall, prices tend to bounce back quickly from those one-off events,” said Kim Grauer from Chainalysis.
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