Token Surges 2500% in an Hour, Liquidity Issue or Something Else?

Yesterday, the token BTCV surged as much as 2500% in an hour on cryptocurrency exchange WBF, World Blockchain Forum.

The value of the token surged from $300 to the high of $8,000 only to fall down below its original price. According to the exchange,

“BTCV’s short-term liquidity in the disk due to fewer Maker orders on the disk caused a rapid price increase after some funds flowed in.”

But netizens believe something else was in play here.

“Hot wallets allegedly drained,” shared Matthew Graham, CEO, Sino Global Capital.

One of the addresses of the exchange transferred out 50 ETH when the price of BTCV changed drastically yesterday. Today, another 25 ETH was transferred out that has the remaining balance at 45.5 BTC. Other addresses have few assets left as well.

Although not a known exchange internationally, the exchange and its founder Sheng Zhao are known for promoting the Ponzi schemes viz. Plus Token — a $3 billion China-based Ponzi scheme that offered 9% to 18% monthly returns on investment, Cloud Token, S Block, and WoToken.

The traffic of the site meanwhile has dropped more than 61% in the past six months, currently seeing nearly 70k, as per SimilarWeb.

Earlier this month, there have also been reports of police in China freeing the bank accounts of those dealing with crypto assets over illegal activity.

“Frozen bank accounts will increasingly be a major risk factor for China crypto, especially given that many local participants effectively play in the gray area,” said Graham.

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