- LOOM surpassed Bitcoin in trading activity for a brief period of time.
- The sudden burst in value sparked concerns about market manipulation.
Loom Network [LOOM] blasted off to its highest market value in more than five years, as investors grappling with the bear market scrambled to get their hands on the cryptocurrency.
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LOOM logged a meteoric rise of 746% over the past month, beating competitors to emerge as the best performing asset in the market, data from CoinMarketCap revealed. The crypto was also the highest gainer in the last 24 hours, with gains of nearly 10%.
In fact, as per a recent post by on-chain analyst Maartunn, LOOM even eclipsed the world’s largest crypto by market cap, Bitcoin [BTC], in trading activity for a brief time period on 15 October.
The trading volume for $LOOM surpasses that of $BTC 🤯 pic.twitter.com/iYI8plcMKe
— Maartunn (@JA_Maartun) October 15, 2023
LOOM wakes up from slumber
Loom Network is a layer-2 scaling solution launched in September 2018. Built on the delegated proof-of-stake (PoS) mechanism, the project supports Ethereum [ETH], Binance chain [BNB], and Tron [TRX].
The native token LOOM is an ERC-20 token, used for securing the network and as hosting fees for decentralized applications (dApps).
However, the project has been off the boil in recent years, with nothing significant to boast about in terms of ecosystem developments. Even the 2021 bull market didn’t launch the token to the highs that one would have expected.
Source: CoinMarketCap
Something fishy going on?
Apparently, the project’s official page on social platform X (formerly Twitter) did not provide any updates on a feature addition or a technological development, both of which are thought to be catalysts for assets in the industry.
Hence, it could be assumed that market forces were solely responsible for LOOM’s recent movements. But then, the sudden burst in value sparked concerns about market manipulation.
A Bitcoin investor, going by the pseudonym TheWignus on X, alleged that the recent pumps in prices of certain cryptos, including LOOM, were not organic. However, they didn’t provide any evidence to back the claim.
Sudden #PUMPs or Manipulation are happening on this #assets with over 50-100% rose in the 48H. 🚀💸#OOKI#ALPACA#LOOM#BOND#TRB#GFT#LQTY#UFT#RPL#PNT
— TheWignus (@TheWignus) October 15, 2023
Schemes like pump-and-dumps have been fairly common, not just in crypto markets but traditional finance as well. It happens when a person or group starts to artificially inflate the price of an asset by disseminating positive news around it.
Read Loom Network’s [LOOM] Price Prediction 2023-24
Once unsuspecting investors are lured in and the price is sufficiently “pumped,” the holders start dumping their assets at profits. This sends the price of the asset tumbling, and new investors are stuck with a low-value asset.
Therefore, traders were advised to tread with caution and factor in different aspects before they decide to put their money into soaring assets. Remember to DYOR.