Was the big bitcoin price hike last year just caused by investor enthusiasm

Was the big bitcoin price hike last year just caused by investor enthusiasm

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Answer Was the big bitcoin price hike last year just caused by investor enthusiasm

In a study published on Wednesday claiming that more than half the value of Bitcoin It was due to a coordinated price gouging.

University of Texas economics professor John Griffin, who has 10 years of experience in detecting financial fraud, and graduate student Amin Shams examined millions of cryptocurrency exchange transactions on the Bitfinex platform and published a 66-page paper in which they showed that Tether was used for manipulation and fixing. Cryptocurrency price.

Griffin told CNBC: “Cheating and manipulation often leave traces behind, and the good thing is that the blockchain is there to track them.”

By tracking Bitfinex transactions recorded on the balance sheet, Griffin found that another coin was used to buy bitcoin after its price fell.

Read:Binance announces the official launch of “Bifinity”…Details here

He pointed out that: “It was providing support to the price of Bitcoin, and in the period we investigated, we found a significant impact on the price.” He added: “Our research indicates that some are harnessing the interest of investors for their own benefit.”

Griffin found that about 87 hours, or about 1% of tether trading, could explain a 50% rise in the price of bitcoin and a 64% rise in the value of other altcoins.

The price of Bitcoin soared to $20,000 in December from $1,000 at the beginning of last year and this year Bitcoin has lost more than half its value and is now worth $6,252.

Both Bitfinex and Tether, the company that issues digital currency, are causing concern for some in the industry.

“The lack of transparency surrounding Tether is troubling to me,” said Dan Ketoli, a software engineer and blockchain analyst at Bespoke Group, “and that the release of Tether likely contributed significantly to the bitcoin price rally last year.”

In December, the CFTC sent court subpoenas to Tether and Bitfinex, and in 2016 the commission fined them $75,000 for failing to register with the syndicate and enabling illegal transactions. Months later, hackers stole 119,756 Bitcoin from Bitfinex.

Read:An NFT meme titled “Friendship Over” sells for 20 ETH (more than $50K)

Bitfinex is one of the largest digital exchange platforms in the world and is registered in the Caribbean and owned by a company based in the British Virgin Islands but with offices in both Asia and Europe.

CEO of Bitfinex J.L. Van der Veld told CNBC that his company was not involved in any currency market manipulation.

He said, “The issuance of Tether cannot be used to raise the price of Bitcoin or another currency.”

Read:A new hack for a cryptocurrency platform and customer data leakage

As for Tether, no statement has been issued!

Griffin has spent the past decade publishing research on credit agency fraud and mortgage fraud from banks until he recently became interested in fraud in the VIX Volatility Index.

At the moment, he turned his attention to the cryptocurrency market, as he made it clear that there is not enough supervision in it.

He said: “In general, I am looking at things that may be illegal and there are a lot of rumors that digital currencies are illegal,” “So it is useful to look at what the available information provides.”

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