Bitcoin price, the growth of 2017 has been manipulated. New findings from a University of Texas study.
The epic Bitcoin price growth last year may have been decidedly influenced by a manipulation activity. To support it is a recent study, published a few days ago, according to which at least half of the increase in capitalization that bitcoins had in 2017 is due precisely to a coordinated manipulation of prices.
John GriffinUniversity of Texas professor of finance, committed to detecting and analyzing financial fraud for over 10 years, and researcher Amin Shams, have examined millions of transactions on the cryptocurrency exchange Bitfinex. On the sidelines of this observation, in an article by 66 pages, the authors found that the tether it had been used to buy bitcoins at key times when it was in decline, thus helping to "stabilize and manipulate" the cryptocurrency price.
"Fraud and manipulation often leave footprints in the data and it's nice to know blockchain can track things," Griffin told CNBC. Analyzing the Bitfinex transactions, recorded in a public ledger, Griffin discovered that another criptovaluta, tether, had been used to buy bitcoins after a sharp drop in prices. The authors traced this pattern and found periods of suspicious activity related to the issue of tether, allegedly anchored to the value of the US dollar.
"Price support for bitcoins was created and - in the period we looked at - we experienced huge effects," said Griffin. "Our research would indicate that there are people who exploit the interest of investors for their benefit" - he added.
Bitcoin rose to nearly $ 20.000 per unit in December after starting below $ 1.000 a year last year. This year, the first and most popular criptovaluta the world has lost more than half its value, trading at around $ 6.200 during the Griffin's statements.
Both Bitfinex and Tether, the company that issues the virtual currency, have been cause for concern for some industry analysts. “The lack of transparency surrounding it Tether raise some red flags for me, ”said Dan Ciotoli, computer engineer and analyst blockchain by Bespoke Investment Group. "The issuance of Tether is likely to have contributed significantly to artificially moving bitcoin prices over the past year," he added.
Other analysts have expressed concern that Tether does not actually hold enough dollars to support all its digital coins in circulation. In December, the Commodity Futures Trading Commission sent a subpoena to Bitfinex and Tether. In 2016, the CFTC fined Bitfinex for $ 75.000 for not registering with the regulatory agency and for offering "illegal" cryptocurrency transactions. A few months later, hackers stole 119.756 bitcoins.
Bitfinex is one of the world's largest volume cryptocurrency platforms, and is registered in the Caribbean, owned by a company in the British Virgin Islands. Bitfinex CEO JL van der Velde told CNBC in an email that "Bitfinex and Tether have never been involved in any kind of price action and market manipulation."
