[2019-12-17] Bitcoin’s failing price could be caused by $2B Chinese Ponzi scheme

[Betwrong]

Bitcoin’s failing price could be caused by $2B Chinese Ponzi scheme dumping its crypto

 ...

However, the firm made it clear that while it does indeed conclude that PlusToken cashouts correlate with drops in Bitcoin‘s price, correlation doesn’t exactly mean causation.

What Chainalysis does say is that PlusToken dumping causes increased volatility in Bitcoin’s value, as well as correlates significantly with Bitcoin price drops.

“Keep in mind that PlusToken cashouts are just one of many potential influences on Bitcoin’s price. Media stories, concerted market manipulation efforts, algorithmic trading errors, or any number of other factors may have contributed to volatility as well,” said the firm.

https://thenextweb.com/hardfork/2019/12/17/bitcoin-cryptocurrency-price-dump-ponzi-scheme-plustoken/


Forbes wrote yesterday that "the bitcoin price might struggle over the short term due to the $2 billion PlusToken scandal", but I tend to agree with the words from thenextweb's article, namely with "correlation doesn’t exactly mean causation". I think the current market can easily devour 20,000 BTC, that is, according to the article, "is still waiting to be dumped", without even noticing it.

What do you guys think?

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[Bossian]

You beat me to it  was about to post the same thing.
Was reading this https://cryptobriefing.com/bitcoin-plustoken-ponzi/

What do I think?

I don't really care. I believe Bitcoin price strictly follows TA (technical analysis) big majority of the time. Second I am not sure how and from which source they could get such information. Curious to see the effect on price but as I was saying Bitcoin price is mostly dictated by trading analysis anyway. Fundamentals barely have any effect.

[squatter]

Forbes wrote yesterday that "the bitcoin price might struggle over the short term due to the $2 billion PlusToken scandal", but I tend to agree with the words from thenextweb's article, namely with "correlation doesn’t exactly mean causation". I think the current market can easily devour 20,000 BTC, that is, according to the article, "is still waiting to be dumped", without even noticing it.

What do you guys think?

45,000 BTC and 800,000 ETH -- around $400 million -- is a considerable amount for the spot market. During market conditions like 2017, it could probably absorb that easily enough, but in 2019? I'm not sure. I imagine it's having a non-negligible effect.

The PlusToken scammers are slowly offloading to OTC brokers, who are then pressuring exchanges like Huobi down. Arbitrage among the global exchanges handles the rest.

[bbc.reporter]

You beat me to it  was about to post the same thing.
Was reading this https://cryptobriefing.com/bitcoin-plustoken-ponzi/

What do I think?

I don't really care. I believe Bitcoin price strictly follows TA (technical analysis) big majority of the time. Second I am not sure how and from which source they could get such information. Curious to see the effect on price but as I was saying Bitcoin price is mostly dictated by trading analysis anyway. Fundamentals barely have any effect.

It was @Thewolf666 that beat everyone to it.

https://bitcointalk.org/index.php?topic=5175906.0

The news was also treated as fud and the person responsible for exposing the scammers was called a social media randomer hehehe. I reckon the excitment of the pump had ears closed.

[CryptoBry]

Whether this very big ponzi scheme and the eventual offloading of Bitcoin and Ethereum they got caused this ongoing dump will always be subject to debate and speculation though what can be certain is that a thing like this magnitude can certainly be affecting the market in one way or another so the debate should be the extent of the influence that PlusToken is able to pull in the coming days and weeks, as certainly more offloading can be coming. In the current market where demand is not that impressive, any movement can surely be a big pull that can push Bitcoin down to the drain. Let's hope that the coming of 2020 will be changing this scenario for the better.

[bbc.reporter]

@CryptoBry. It is clearly not speculation anymore. There are new evidences from Chainalysis that support Dovey Wan's hypothesis.

https://blog.chainalysis.com/reports/plustoken-scam-bitcoin-price

[Betwrong]

@CryptoBry. It is clearly not speculation anymore. There are new evidences from Chainalysis that support Dovey Wan's hypothesis.

https://blog.chainalysis.com/reports/plustoken-scam-bitcoin-price

So it's true then? Not only those scammers robbed millions of people, but now they are crashing the market? FFS, when will it end? When people are going to realize that this

PlusToken presented itself as a cryptocurrency wallet that would reward users with high rates of return if they purchased the wallet’s associated PLUS cryptocurrency tokens with Bitcoin or Ethereum. The scammers claimed those returns would be generated by “exchange profit, mining income, and referral benefits.”

is a red flag?

Well, probably never. I personally know a person who was scammed 3 times already, during the past 5 years. And yet he contacted me a couple of months ago trying to convince me to buy another scam coin, in which he already invested by the time. Sometimes I think it's a kind of incurable disease, and we will always have such people around.

Back to the topic though. Although the report is saying that "the scam attracted over $3 billion worth of cryptocurrency", in the end they repeat the "20,000 BTC" which "has yet to be cashed out". And I think the process of dumping this amount, even if it will be dumped entirely, will not be affecting the market for too long.

[cr1776]

...When people are going to realize that this is a red flag? ...

I think you are right - probably never.  People want a quick buck and think "this time it is different" and someone can really pay be 1%/day or whatever.  Whether naive, stupid or just greedy, there are enough people out there that someone, somewhere will try and take advantage of them.

[bbc.reporter]

@Betwrong. It certainly appears that way. However, it is very understandable for most of us to be in denial of the bad news during bitcoin's pump when the news was beginning to be discovered on August.

Also, no one can predict how long the market is to be affected by this. It might be long, it might be short hehehe.

[1Referee]

Also, no one can predict how long the market is to be affected by this. It might be long, it might be short hehehe.

It can't be too long with the block halving approaching quickly. I'm confident that it hasn't been priced in yet, and I'm confident that we'll get the price to start calculating it in a month or two before the actual event. I'm putting my money where my mouth is by doing everything I can to stack up more coins because it could very well be the last ever time we see these levels again.

In terms of the sentiment, it's horrible, and that's actually a good thing because the market tends to move in the opposite direction of the dumb money herd. This doesn't mean that we're completely out of the woods yet, but buying at today's prices is a whole lot more rewarding than fomo'ing into the market at +$10,000 levels.

I can only say thank you for this opportunity. 

[gentlemand]

Disappointing to see that there are people who still fall for this shit and the sheer volume of it. Guess stupidity and greed is near infinite and eternal. Unfortunate too that one bunch of assholes can potentially influence what should be a global market. Goes to show we have a way to go yet.

[darkangel11]

Disappointing to see that there are people who still fall for this shit and the sheer volume of it. Guess stupidity and greed is near infinite and eternal. Unfortunate too that one bunch of assholes can potentially influence what should be a global market. Goes to show we have a way to go yet.

I feel the same. There's a bunch of golden rules that always work for identifying investment scams. One of them is that they promise incredible gains unheard of in traditional markets and are always sure of your success. They will offer you a steady 100% a year guaranteed, or even more and people believe them and give them money. The higher the promised gains the higher the probability of it being a scam. People are blind and don't get that 10% a year is something a good trader or investment banker is able to offer. Not 100% or 200%.
Some people are just meant to lose money. You cannot protect them. They will pay the scammers and fight you when you tell them not to do it.

[hatshepsut93]

Seems like the price has mostly recovered today, so the recent crash was just a panic and manipulation rather than something fundamental - and it would have been really surprising if some Chinese Ponzi could have influenced the price for a longer period of time. The lesson here is as usual - do not let sensational news affect your trades, look at the long term.

[squatter]

Seems like the price has mostly recovered today, so the recent crash was just a panic and manipulation rather than something fundamental - and it would have been really surprising if some Chinese Ponzi could have influenced the price for a longer period of time.

It could have a longer term effect if they are still slowly bleeding the supply into the market. It's comparable to the Mt. Gox bankruptcy trustee selling off similar amounts of bitcoins last year. Even though the bitcoins are sold OTC, most of that supply probably lands on exchanges.

I would consider this fundamental supply and demand, not manipulation. Chinese people were still buying BTC and ETH to put into PlusToken until late June. That demand was driving market prices up. The supply accumulated by the scammers pushed them back down.

[malevolent]

Seems like the price has mostly recovered today, so the recent crash was just a panic and manipulation rather than something fundamental - and it would have been really surprising if some Chinese Ponzi could have influenced the price for a longer period of time. The lesson here is as usual - do not let sensational news affect your trades, look at the long term.

Medium-term we may see the price heading further downwards with this new low. And the price only recovered to where it was a week ago. 30 days ago it was $1k higher.

[hatshepsut93]

Seems like the price has mostly recovered today, so the recent crash was just a panic and manipulation rather than something fundamental - and it would have been really surprising if some Chinese Ponzi could have influenced the price for a longer period of time. The lesson here is as usual - do not let sensational news affect your trades, look at the long term.

Medium-term we may see the price heading further downwards with this new low. And the price only recovered to where it was a week ago. 30 days ago it was $1k higher.

Right, I too think that the market will continue do be bearish, but it's not going to free-fall, and it's probably not going to go down much further than 6k or high 5k. The last bottom was at 3k, so we are currently close to another bottom, if we extrapolate the chart. These ponzi news are just a fluctuation, it doesn't matter much even on medium term.

[pixie85]

Right, I too think that the market will continue do be bearish,

Is it really bearish? We were bearish whole 2018 and are now consolidating. We used to be at 6000 before that manipulated drop to 3000 and then we recovered but overshot. We should have recovered to 8-9 thousand not 14 and that's why we had so much uncertainty. Many people read it wrong like it's another big bull market but it was not and the confusion turned into short term panic. If there was no overshot to 14 thousand we'd be at 7-8 thousand anyway because that's where a steady rise from Novembber 2018 would take us.

I don't know why so many people still think we're going to go lower than 5000.

[malevolent]

Is it really bearish? We were bearish whole 2018 and are now consolidating. We used to be at 6000 before that manipulated drop to 3000 and then we recovered but overshot. We should have recovered to 8-9 thousand not 14 and that's why we had so much uncertainty. Many people read it wrong like it's another big bull market but it was not and the confusion turned into short term panic. If there was no overshot to 14 thousand we'd be at 7-8 thousand anyway because that's where a steady rise from Novembber 2018 would take us.

I don't know why so many people still think we're going to go lower than 5000.

There's nothing guaranteeing a steady rise. If tens of thousands of bitcoins are still waiting to be sold from this ponzi there's no telling how low we'll go.

[figmentofmyass]

Right, I too think that the market will continue do be bearish,

Is it really bearish?

I don't know why so many people still think we're going to go lower than 5000.

because the market has already dropped 54% from the highs and people are worried the carnage will continue. there's no measure by which the downtrend has been broken yet. as they say, the trend is your friend, until it ends.

[bbc.reporter]

Also, no one can predict how long the market is to be affected by this. It might be long, it might be short hehehe.

It can't be too long with the block halving approaching quickly. I'm confident that it hasn't been priced in yet, and I'm confident that we'll get the price to start calculating it in a month or two before the actual event. I'm putting my money where my mouth is by doing everything I can to stack up more coins because it could very well be the last ever time we see these levels again.

In terms of the sentiment, it's horrible, and that's actually a good thing because the market tends to move in the opposite direction of the dumb money herd. This doesn't mean that we're completely out of the woods yet, but buying at today's prices is a whole lot more rewarding than fomo'ing into the market at +$10,000 levels.

I can only say thank you for this opportunity. 

I hope so for all cryptospace. However, my advice would be to learn from litecoin's halving and to prepare for disappointment. It will make acceptance quicker hehehe.

[malevolent]

I hope so for all cryptospace. However, my advice would be to learn from litecoin's halving and to prepare for disappointment. It will make acceptance quicker hehehe.

Litecoin is a speculative shitcoin which almost no one uses, its price started collapsing just after Bitcoin's, and like other shitcoins it also started losing value against BTC.

[gentlemand]

Litecoin is a speculative shitcoins which almost no one uses, its price started collapsing just after Bitcoin's, and like other shitcoins it also started losing value against BTC.

Has anyone collated info on shitcoin halvings for those coins that have it? Does it have any type of notable effect?

I assume demand and volume swings that much more violently than BTC that those factors overwhelm it.

[figmentofmyass]

Has anyone collated info on shitcoin halvings for those coins that have it? Does it have any type of notable effect?

I assume demand and volume swings that much more violently than BTC that those factors overwhelm it.

i've only looked into LTC. the last two times, it had major pumps---against both BTC and USD---leading into the halving. from may-july 2015 and january-april 2019 it strongly outperformed BTC and the rest of the altcoin market.

i think that says something about the halving effect. LTC is one of the most liquid altcoins though. low cap coins may not behave the same way.

[buwaytress]

Has anyone collated info on shitcoin halvings for those coins that have it? Does it have any type of notable effect?

I assume demand and volume swings that much more violently than BTC that those factors overwhelm it.

i've only looked into LTC. the last two times, it had major pumps---against both BTC and USD---leading into the halving. from may-july 2015 and january-april 2019 it strongly outperformed BTC and the rest of the altcoin market.

i think that says something about the halving effect. LTC is one of the most liquid altcoins though. low cap coins may not behave the same way.

If I recall, this was also a coinciding event for Segwit adoption. I believe a lot of people still feel LTC takes some credit for being a guinea pig for potential Bitcoin upgrades, and the successes it had with Segwit, atomic swaps, lightning, coinciding with halving and then with people claiming credit for the upgrades Bitcoin eventually took up after it, all contributed to those pumps.

Personally, even with Bitcoin, halving immediate or short-term impact's already almost negligible... everything is priced in gradually already.

[Swordsoffreedom]

Has anyone collated info on shitcoin halvings for those coins that have it? Does it have any type of notable effect?

I assume demand and volume swings that much more violently than BTC that those factors overwhelm it.

i've only looked into LTC. the last two times, it had major pumps---against both BTC and USD---leading into the halving. from may-july 2015 and january-april 2019 it strongly outperformed BTC and the rest of the altcoin market.

i think that says something about the halving effect. LTC is one of the most liquid altcoins though. low cap coins may not behave the same way.

If I recall, this was also a coinciding event for Segwit adoption. I believe a lot of people still feel LTC takes some credit for being a guinea pig for potential Bitcoin upgrades, and the successes it had with Segwit, atomic swaps, lightning, coinciding with halving and then with people claiming credit for the upgrades Bitcoin eventually took up after it, all contributed to those pumps.

Personally, even with Bitcoin, halving immediate or short-term impact's already almost negligible... everything is priced in gradually already.

What about long term impact? There has to be long term impact of halving and I don't think it can be priced in half a year before.

[1Referee]

What about long term impact? There has to be long term impact of halving and I don't think it can be priced in half a year before.

Of course there is a long term impact. Miners are rewarded fewer coins, which means that there is less that they can dump on you to cover their expenses.

The thing that people have to keep in mind is that a bear market can drag on for such a long period of time, that it may seem that the halving doesn't have much of an impact, so you have to be patient and not get worried if the price doesn't right away go up to whatever level you hope to sell at.

It's a game where the most patient holders are rewarded the most. Impatient 'holders' will get less, or nothing at all if they sell out of frustration.

[Carlton Banks]

@CryptoBry. It is clearly not speculation anymore. There are new evidences from Chainalysis that support Dovey Wan's hypothesis.

https://blog.chainalysis.com/reports/plustoken-scam-bitcoin-price

you mean Chainalysis, the company proven to be acting against the interests of Bitcoin holders and the Bitcoin ethos, that company?

why should we take their technical analysis as anything more than a part of their wider push for the incumbent financial system to exert more control over cryptocurrencies? They have every incentive to promote the prevention of using cryptocurrencies freely, their business literally is the undermining of capitalism in Bitcoin (i.e. where everyone is enable to behave as an adult that manages their own risk and responsibility)

And I'm slightly taken aback that I'm the first person on this thread to say any of the above.


The whole thing sounds like some level of bullshit to me, how on earth can $2 billion of dumb money really become convinced of a scheme that didn't have any upfront delivery of any known asset? It sounds very unlikely to me, although not impossible of course. And then Chainalysis come along with their Craig Wrong blockchain-based "evidence" act, full of assumptions we're expected to be too stupid to challenge.