For those who decided to take an interest in the MATIC, token of blockchain scalability network Matic Network from the Binance IEO Launchpad, they would have been thrilled with this month’s returns. The coin was up 170 percent for the month.
However, the last 24 hours have been cruel to investors as an apparent flash crash saw 70 percent of that value almost instantly wiped out with many questions left unanswered as to what has happened.
Allegations of data manipulation and FUD abound for Matic, but there are investigations ongoing with the head of Binance, Changpeng Zhao, stating they are investigating it but feel that it is clear the Matic team had nothing to do with the sudden price drop.
This month, to explain the price rise, Matic had been showing some good developments and partnerships which had the coin up to 54th in market cap before the flash crash came. It’s was up by 55 percent in a week and by 175 percent in a month despite trading sideways most of November.
However, all that good work has been undone with Matic now down to 82nd in the market cap standings and a massive 73 percent price retracement, causing a lot of panic. The Co-founder and COO of Matic Network, Sandeep Nailwal, is trying to address the panic. In a Tweet, he said:
“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”
The positivity from Nailwal was still met with skepticism, which prompted Binance’s CEO, Zhao, to also tweet that the exchange is of the opinion that it was not an inside job.
“Our team is still investigating the data, but it’s already clear that the MATIC team has nothing to do with it. A number of big traders panicked, causing a cycle. Going to be a tough call on how much an exchange should interfere with people’s trading,” Zhao said.
It appears as if the reason behind this flash crash and failed trust in the network originates from another tweet that accused Matic Network Foundation of transferring 1,495,322,715 MATIC in the past 50 days, which is equivalent to 15% of its total supply.
Yet, that Tweet, if it did spark fear and a sell-off, was incorrect to do so as the tweeter, Samuel JJ Gosling, admitted afterward he had got things wrong.
“I just want to deeply apologise for providing an inaccurate claim, it turns out it was only 381,903,830 $MATIC (3% of the supply) that “seems” has been liquidated, I made a miscalculation and included inputs as well as outputs in my computation.,” he added.