- SushiSwap trading volumes increased by as much as 569% in 24 hours.
- On-chain activities fueled suspicion of market manipulation.
Native token of decentralized exchange (DEX) SushiSwap [SUSHI] has stunned the crypto market with gains of over 20% in the past 24 hours CoinMarketCap. At the time of writing, the token was exchanging hands at $0.7865, the highest in almost five months.
Realistic or not, here is SUSHI’s market cap in BTC terms
Signs of something suspicious?
As prices skyrocketed, traders rushed to get their hands on the token. Frantic buying and selling activity followed, as trading volumes increased by a whopping 569% in a 24-hour period.
While market participants welcomed the development, such dramatic price increases often raise suspicion. Popular activity tracker in the chain Look at chain expressed a similar sentiment, flagging concerns about market manipulation.
The analytics firm stated that a newcomer to the market bought a ton of SUSHI tokens, more than 900,000, from decentralized exchanges.
Shortly after, they started transferring USD Coin [USDC] to the decentralized derivatives exchange dYdX [DYDX] use multiple new wallets. Lookonchain suggested that the purpose of the wallet could be to artificially inflate the price of SUSHI and go long.
The number of long accounts even exceeded short accounts on October 31, reflecting the dominance of bullish leveraged traders.
Source: Coinglass
Should SUSHI traders beware?
Typically, influential players use this technique to create a buying frenzy that will “inflate” the price of a stock. Once prices are inflated enough, these holders start dumping their assets at a profit.
This causes the price of the asset to plummet, and new investors are stuck with an asset with a low value.
Although there was no concrete evidence that fits the above scenario in the context of SUSHI, investors should be cautious and use DYOR. It was normal for profit-hungry traders to get carried away by these events, especially in a bear market.
How much are 1,10,100 SUSHIs worth today?
However, a sharp price correction could wipe out all their gains.
Meanwhile, SushiSwap’s DEX volume has increased significantly over the past 24 hours, data shows DeFiLlama revealed. Trades worth over $11 million were executed on the platform, representing an increase of almost 33% compared to the previous day.