Matic Network (MATIC) Breaks Rally on Rumors of Dumping
A single tweet cut short the MATIC rally on Binance, erasing half the gains during the recent price spike.
Matic Network (MATIC) was on track to line up among the best IEO tokens with strong performance in 2019. But the token unlocking schedule of the team led to doubts about the potential to dump on the market.
A single tweet, later debunked, stated that MATIC may have caused the price slide, which at one point pushed the asset 72% down in a few hours. MATIC has recovered since then, but remains down more than 52%, to $0.02.
The sudden volatility led Binance to disable margin trading, as well as lending, as shorting the asset would cause even more volatility.
Just hours after the volatile price moves, margin trading was disabled, to discourage large-scale shorting.
MATIC volumes reached above $359 million in reported volumes, a significant spike from the usual levels near $60 to $70 million. The coin is now entering another stage where speculation grows, instead of slowing down.
Changpeng “CZ” Zhao commented that Binance was investigating the issue, while estimating how far an exchange can meddle in the natural course of trading.
The Matic team announced it will only unlock a small amount of tokens, of which just a fraction would be given to project supporters. The rest of the unlocked coins will be put up for staking, again limiting the supply.
MATIC has been rising since the end of November, rising from the one-cent level to a peak above $0.04. But at the peak, rapid selling and panic brought the price to a low around $0.016. Even after the price drop, MATIC has recovered to its post-IEO high. Now, MATIC is awaiting for the panic to subside, and will have to discover a new stability level.
MATIC shows that even for carefully curated projects, volatility is not out of the question. The MATIC price moves happen on the centralized Binance market, with a predominance of the BTC pairing. On Binance DEX, MATIC only sees limited volumes, and a slightly higher price at $0.024.