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Bitcoin's Price Was Artificially Inflated Last Year, Researchers Say (nytimes.com)
A concentrated campaign of price manipulation may have accounted for at least half of the increase in the price of Bitcoin and other big cryptocurrencies last year, according to a paper released on Wednesday by an academic with a history of spotting fraud in financial markets. From a report, first shared to us by reader davidwr: The paper by John Griffin, a finance professor at the University of Texas, and Amin Shams, a graduate student, is likely to stoke a debate about how much of Bitcoin's skyrocketing gain last year was caused by the covert actions of a few big players, rather than real demand from investors. Many industry players expressed concern at the time that the prices were being pushed up at least partly by activity at Bitfinex, one of the largest and least regulated exchanges in the industry. The exchange, which is registered in the Caribbean with offices in Asia, was subpoenaed by American regulators shortly after articles about the concerns appeared in The New York Times and other publications. Mr. Griffin looked at the flow of digital tokens going in and out of Bitfinex and identified several distinct patterns that suggest that someone or some people at the exchange successfully worked to push up prices when they sagged at other exchanges. To do that, the person or people used a secondary virtual currency, known as Tether, which was created and sold by the owners of Bitfinex, to buy up those other cryptocurrencies.
The big MtGox bubble in 2013 was caused by Willybot. Other bots have been developed since then to pump the price. I seen the price of Bitcoin rise over a 1000 dollars in a minute at the peak of the bubble due to bot activity.
And how do we know these "researchers" are not artificially pushing down the price of Bitcoin now...
They are actually real researchers who have written a paper describing their findings. Previous to this they released a paper about manipulation of the VIX. To describe and expose asset manipulation publicly while being held to the standards of science is their career, and they are doing quite well. To suggest that they also secretly engage in asset manipulation seems far fetched at best.