Matic, Indian led crypto asset crashes 80%. Racism ensues

Yesterday, Matic, an Ethereum side-chain protocol, saw around a 80% decrease in price after about a month of upside. Afterwards, anonymous traders on crypto Twitter couldn’t help but express racism towards Indians due to the ethnicity of Matic’s leadership.

Racist jokes towards Matic’s Indian leadership

The most noticeable thread where users were stereotyping was on zyzz’s Tweet, a trader with a paid group and frequent of crypto Discord chat rooms. He posted a picture of EtherScan’s records of the Matic Foundation sending MATIC to Binance, implying that they were responsible for the crash, and included a picture of the founders next to it.

Here’s some replies to the thread:

Obviously, these commenters are associating a derrogatory stereotype of Indian people as scammers. A common slur that I’ve seen in crypto Discord groups is to joke about “Pajeet” when talking about a scam. Pajeet is a stereotypical name for Indian people, and apparently the slur started on 4chan.

Here’s another offensive response in the same thread:

Matic Founder’s response

One founder of Matic, Sandeep Nailwal, responded to the racial attacks.

“I m seeing such racial attacks on a hardworking Indian project which hs been striving hard & making an impact even with small resources Entire Indian community needs to unite against this racial slur & fight to prove our worth We hv top Indian teams in all blockchain sectors” – @sandeepnailwal

Racist culture thrives in an anonymous crypto space

While it’s natural for people in the crypto space to be weary of pump-and-dump schemes, and there appears to be reasonable evidence that suggests the Matic Foundation has sent large amount of money to Binance, the immaturity in the crypto space is concerning.

Before, we have covered an anonymous crypto trader with 70,000 followers saying that women should never have been able to vote. It’s possible to have a messed up sense of humor, but the frequency in which this behavior is accepted, and the lack of consequences due to anonymity is a plague to the space.

Crypto is one of the few industries where privacy and anonymity is respected to an extent, but it may be detrimental to the expansion of the space as the culture could deter a large demographic of people. At the same time, it attracts those who desire the ability to spread hatred, ethnocentrism, etc.

 

[Update: New math] Allegedly, Matic sent around $10 million of their supply to Binance, mostly for liquidation

Earlier today, the price of $MATIC dropped around 80% within 24 hours. People are now investigating as to why there was such a huge dump, and some think EtherScan records hold the answer.

Samuel JJ Gosling, Founder of Validity Crypto, posted a link to the Matic Foundation’s records, where they sent around $10 million (calculated at all-time high) to Binance addresses. On first look, the transactions lead to unknown addresses, but tracking them further shows that they were deposited, or possibly sold to known Binance 1, 2, 3 and 4 addresses.

There are 10 trillion Matic Tokens in circulating supply and around 300 billion were sent withdrawn from the foundation.

Matic and Binance’s response 

Sandeep Nailwal, Co-founder of Matic responded to Goslings post very critically.

“FUD account. We will post the exact numbers. This is complete BS, the out amount is from the smart contract lockup account to Foundation account. Amounts sent to Binance or any other accounts are in conjunction with our token release. Why would a project do this deliberately,” tweeted Nailwal

Changpeng Zhao, CEO of Binance backed up his claims.

“Our team is still investigating the data, but it’s already clear that the MATIC team has nothing to do with it. A number of big traders panicked, causing a cycle. Going to be a tough call on how much an exchange should interfere with people’s trading.” – @cz_binance

FUD is a term that Zhao is notorious for throwing around, and is short for ‘fear, uncertainty and doubt.’ Nailwal calling the linked address a “FUD account” implies that it is not theirs. If this is true, it is unclear how EtherScan picked the address up as the Matic Foundation.

MATIC is a low market cap coin, and if even $10 million worth of a coin that was worth $.05 was sold all at once, it might be able to initiate a crash around the magnitude of what happened today. Observers are waiting for Binance and Matic to come up with more evidence before there is a consensus of no foul play.

Update:

Gosling updated the math and it turns out that only 3% of MATIC supply was sent to Binance, closer to $10 million USD. Originally this post had published that it was $67 million.

 

$MATIC just crashed harder than any coin has in a long time, and people are confused

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.

https://twitter.com/cryptodonalt/status/1204207941945090048

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:

https://twitter.com/CryptoWelson/status/1204210798689542144?s=20

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.

Matic creators Jaynti Kanani, Sandeep Nailwal, and Anurag Arjun have not made any statements on Twitter about the coins sudden increase in price, or the drop.

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.

 

UPDATE: 

Reddit user u/McNeiltherealdeal is claiming to have lost $53 million.