Bitcoin Tanks Below $7000 as PlusToken Scammers Cash Out

| Updated
by Bhushan Akolkar · 3 min read
Bitcoin Tanks Below $7000 as PlusToken Scammers Cash Out
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PlusToken is said to promise investors awards for purchasing their native PLUS tokens against Bitcoin and Ethereum.

In yet another major sell-off Bitcoin price crashed below its crucial support of $7000 on Monday, December 16. As per blockchain researcher Chainalysis, this dumping is part of another major scam brewing in the crypto industry.

In its report, Chainalysis mentions a China-based Ponzi scheme PlusToken which is dumping its crypto holdings to cash out. PlusToken, a cryptocurrency wallet, trapped investors by promising high returns to those purchasing their native PLUS cryptocurrency against Bitcoin and Ethereum.

PlusToken scammers promised its investors high returns through “exchange profit, mining income, and referral benefits”. The platform was successful in trapping millions of people and raked massive investments. Moreover, the local Chinese media said that this scam attracted over $3 billion worth of cryptocurrency.

The Chainalysis researchers claim that these scammers are most likely behind this massive price crash. The scammers have reportedly cashed out 25,000 BTC and 10,000 ETH. Moreover, the cashouts happened with the help of Huobi‘s OTC brokers. The report reads:

“We can’t say for sure that PlusToken cashouts caused bitcoin’s price to drop. However, we can say that those cashouts cause increased volatility in bitcoin’s price, and that they correlate significantly with bitcoin price drops”.

Furthermore, the report also notes that PlusToken cashout is one of the other influences on the BTC price crash.

Creating Mayhem in the Entire Crypto Market

While the BTC loss is controlled under 35, almost all of the other top-ten cryptocurrencies lost 6-8%. At press time Ethereum has lost 6.5% trading at $131 with less than $15 billion of market cap.

XRP has lost 8%, Bitcoin Cash has lost 5%, Litecoin lost over 8%, EOS 7.5%, Binance Coin 8.8% and so on. Overall, the cryptocurrency market cap has lost over $9 billion in less than 24 hours. At press time, the overall crypto market cap is $186 billion.

Well, it seems that the PlusToken would turn out to be the biggest scam of 2019. Moreover, it suggests the fact that the crypto industry continues to be plagued with illicit players. This could certainly dampen the market sentiments and prevent big players from entering in.

“The PlusToken scam is a powerful example of how cryptocurrency scams harm the public, and should alarm exchanges, law enforcement, and regulators alike. In this case, millions of fraud victims will most likely never recover the funds they were tricked into giving up. […] Regulators around the world should recognize this as a consumer protection issue, and consider how they might apply anti-money laundering regulations to prevent scams like this from happening in the future”, wrote Chainalysis in its concluding statement.

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