A recent Bloomberg report suggests that Bitcoin’s dramatic bull run in late 2017 could be the work of one person. In fact, it claims that researchers have found evidence that a single Bitcoin whale was behind the massive price surge during 2017.
Massive Bitcoin whale led the 2017 Bitcoin rally?
Specifically, the two researchers – John M. Griffin and Amin Shaw – are no strangers to Bitcoin research. In fact, the pair’s latest findings are an update to the duo’s previous deep dive into the Bitcoin markets December explosion from 2017.
At the time, Bitcoin saw a massive boost to its all-time high price of around $20,000. Although the price of Bitcoin since fell, this is still seen as a watershed moment that brought a lot of publicity to Bitcoin and the crypto sector in general.
However, some question why the crypto market saw this explosive price increase. According to Griffin and Sham, Tether may have been used to manipulate this price surge. Griffin and Sham first published this in a research paper back in June of 2018.
At the time, the pair said that transaction patterns on the blockchain suggested Tether may have been used to manipulate the Bitcoin market:
”Purchases with Tether are timed following market downturns and result in sizable increases in Bitcoin prices. The flow is attributable to one entity, clusters below round prices, induces asymmetric autocorrelations in Bitcoin, and suggests insufficient Tether reserves before month-ends.”
Researchers suggest this was part of “Tether manipulation“
Furthermore, the pair went on to argue that these blockchain patterns were consistent with a ”supply-based hypothesis of unbacked digital money inflating cryptocurrency prices”. Now, the two researchers are doubling down on this belief.
They are now stating that a thorough analysis reveals that a ”single entity” was behind this ”market manipulation” in 2017. Furthermore, they believe that this single entity was transacting through Bitfinex, which is Tether’s sister film.
”This pattern is only present in periods following printing of Tether, driven by a single large account holder, and not observed by other exchanges.”
In addition to this, the two researchers also argue that there is only a very slim chance that these patterns are random. Rather, they are saying that this strongly indicates that a single entity was integral to the price development of Bitcoin. However, whether this was done purposefully or not is not something that the pair speculates over:
”Simulations show that these patterns are highly unlikely to be due to chance. This one large player or entity either exhibited clairvoyant market timing or exerted an extremely large price impact on Bitcoin that is not observed in aggregate flows from other smaller traders.”
Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the blockchain industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.