Ethereum Price Declines as PlusTokenAssociated Wallets Display Movement
The Chinese government has taken a significant step in the ongoing PlusToken scam investigation by moving 7,000 ETH, equivalent to $16.7 million, that was seized from the fraudulent scheme. This development has raised speculation about the potential sale of the remaining 542,000 ETH, valued at approximately $1.3 billion.
The PlusToken Ponzi scheme, which defrauded around 2.6 million users between 2018 and 2019, led to the confiscation of $14 billion worth of various cryptocurrencies by Chinese authorities. While a significant portion of the seized Bitcoin was sold off between 2019 and 2020, the Ethereum holdings remained largely untouched until now.
Analyst ErgoBTC from OXT Research has revealed that wallets associated with the PlusToken case, which had been dormant for nearly three years, have recently shown activity. In the summer of 2021, around one-third of the 840,000 ETH was transferred to a lesser-known crypto exchange called Bidesk and subsequently sold. The remaining Ethereum had been sitting in multiple ‘mixing’ addresses until early August 2024.
The recent movement of funds has sparked speculation about the fate of the remaining 542,000 ETH. It is believed that this substantial amount has been consolidated into 294 new addresses, indicating possible preparations for distribution or sale.
The cryptocurrency community is closely monitoring the situation, particularly the potential market impact if the Chinese government decides to liquidate all of the ETH holdings from the PlusToken case. Such a large-scale sell-off could significantly affect Ethereum’s price, which is already experiencing a downward trend. Currently, Ethereum is trading below the $2,400 mark, with a 2% decline in recent hours. This price movement aligns with the overall market trends and the growing uncertainty surrounding the potential influx of seized assets.
Crypto analyst Ali Martinez has observed that Ethereum has been trading in a symmetrical triangle pattern. He suggests that a sustained close below $2,300 could trigger a more substantial drop, potentially reaching the $1,800 level. This technical analysis further contributes to the cautious sentiment prevailing in the market.
The PlusToken case serves as a reminder of the long-lasting effects that large-scale cryptocurrency scams can have on the market. In 2019 and early 2020, when Chinese authorities sold approximately $1.3 billion worth of seized Bitcoin, the impact was significant due to Bitcoin’s smaller market capitalization at the time.
