Bitcoiners consider 2017 as a potential year, particularly because it had witnessed the rapid rise in Bitcoin’s price. Unfortunately, this didn’t last long – 2017 ended with the worst crypto crash ever.
However, analysts back then caught stating that the reason behind rapid price rise was the emergence of Bitcoin futures products in the crypto market – but the new report published by Bloomberg notes that the ‘single whale (a rich investor) caused the pump. Interestingly, the report cites a new study to which it mentioned “a striking new claim” and said;
“a single market whale was likely behind the misconduct, seemingly with the power to move prices at will”.
Notably, Bitcoin was trading at a close value of USD 20000 in late 2017 and is still struggling to gain and sustain the half of its price. At the time of reporting this, Bitcoin is trading at $9278 against USD which is currently showing a gain of 0.62 percent within the past 24Hrs. Despite the crash, the coin remained the first largest cryptocurrency in terms of market capitalization and is currently capturing $167,286,730,301 trading volume.
Although the study cited a lone whale caused the pump, the community seems shocked to read the update surfaced on the web and social media. In essence, the report was first published in 2018 by the University of Texas professor John Griffin and Ohio State University’s Amin Shams. However, this study pointed on a controversial report of Bitfinex-Tether which was a year-old report and was widely famous due to its argument whether or not Tether a fully backed by USD.
Nevertheless, Bloomberg added the statement of Griffin who said;
“Our results suggest instead of thousands of investors moving the price of Bitcoin, it’s just one large one,”.
On the other hand, Tether rejected the claim of both the professor and called the study report as “foundationally flawed”.
“Years from now, people will be surprised to learn investors handed over billions to people they didn’t know and who faced little oversight,” Griffin said in an interview.
As per the Bloomberg, both authors analyzed the market scenario for the period March 1, 2017 – March 31, 2018 and said that their hypothesis on the price of Bitcoin was appeared to be partly based on the fact that “Tether is created without the dollars to back them and then used to buy Bitcoin, leading to rising prices”.
“This pattern is only present in periods following printing of Tether, driven by a single large account holder, and not observed by other exchanges,”, the research paper reads which was shared with Bloomberg media.
Looking at the active and mostly verified Twitter accounts which appears to be the crypto pioneers – nobody seems to agree with the claim of the study report. They refute, stating it wasn’t anything that could possibly have been caused by any single whale.
Image Source – Flickr / Jason Rainman