Matic, a proof-of-stake based side chain network to Ethereum saw massive increases in price throughout the past month, then in 1 day, reverses all progress.
People were under the impression that alt-season might once again have been in fruition with coins like RVN, FETCH and MATIC at least tripling in worth since November. Unfortunately for buyers, those three coins and possibly more had the rug pulled from underneath them. These pairs are all traded on Binance’s leveraged exchange and one veteran trader, DonAlt, pointed out that they were some of the CEO, Changpeng Zhao’s favorites.
As I’m writing this, MATIC has bounced back to the top of it’s 200 day simple moving average, after plowing through the 50 day MA like it didn’t exist.
Some are saying that the owners of MATIC control 90% of the coins supply:
Since Binance users are able to short, or make money off of the price going down, some have turned this into profit. Others surely were either liquidated, stopped out or left with down to 25% of what they invested if they bought the top.
I believe this is the quickest drop in price I’ve seen in a coin since I began observing the crypto space in early 2019. Many exchanges, including Binance, have features called a “stop loss” or “trailing take-profit” which automate the selling process for circumstances like this. I’m hoping this space has matured since 2017 and not many people have been harmed by this decrease in price.
One user on Reddit is already asking “Why is Matic crashing?” Here are some answers that people are giving:
“I’d imagine it’s because it had just gone parabolic. I have it in storage and sit long term, no worries for me.” – u/almondbutter
“Binance exchange hacked” – u/jdbaker82
Nobody can say yet the definite reason behind this sudden price action, but I’m sure more details and conspiracy theories will be voiced soon.
Reddit user u/McNeiltherealdeal is claiming to have lost $53 million.