The “people’s currency” is yet again experiencing lows and this time the reason may be a very serious one. It’s usually market sentiment and recent price decreases have been less than volatile, as Bitcoin was trading around $8,000. What is even more concerning is that Bitcoin was noting new highs recently, “assuring” investors of brighter Bitcoin future in 2020. Now, a massive Ponzi scheme may be the reason why Bitcoin is tumbling below $7,000.
Reportedly, a new group of scammers called PlusToken have attracted approximately $2 billion of cryptocurrency investments. The scammers operate out of China and according to press, the amount of money gathered is already shut down, and $185 million of this sum is already sold off. The entire scheme is said to be a huge Ponzi scheme.
Following the report that revealed the magnitude of the Ponzi scheme, the price of Bitcoin hit new lows to $6,870, a decrease of 3.2% of recent average price levels.
Six people believed to be connected to the PlusToken scheme were already arrested by the Chinese authorities in June 2019. However, according to Chinese press, the stolen money continued to move through multiple crypto wallets and cashed out through brokers. The entire move indicates that more scammers may be out there.
What is more concerning is that analysts now believe that the large amount of Bitcoin poured into the crypto market is a result of the PlusToken criminals offloading their Bitcoin holdings. The estimated addition is around 20,000 Bitcoins, or $150 million in funds. These are still to be cashed out.