Waves token continues to bleed in the fallout from Ponzi scheme accusations

NEW DELHI (CoinChapter.com) — Waves Platform’s namesake native token WAVES prices are freefalling over the past seven days, losing nearly 110% from Apr 1’s high of $58.1 to reaching an intraday low of $27.7 on Apr 7.

The token’s recent downhill rally also saw a nearly 26% drop on Apr 4, its highest single-day loss since May 19, 2021. Moreover, long upper wicks on the daily candles of Mar 30 and Mar 31 indicate a strong presence of profit booking bears.

The Waves token, which saw meteoric growth of nearly 235% in Mar, saw its price fall to immediate support coming from its 50-day Moving Average (yellow) near $26.8. Further downside movement would bring support near $24 into play.

Finally, a market-wide sell-off could see prices fall to $19.4, near WAVES 100-day MA (purple).

Meanwhile, momentum oscillator MACD painted a bearish crossover on Apr 4. A bearish crossover forms when the MACD line (difference between 12-day and 26-day EMA) moves below the MACD signal line (9-day EMA of MACD). Traders often interpret the pattern as a sell signal, further pushing down prices.

Also Read: Waves price jumped 77% in seven days — what’s next?

Moreover, the expanding negative bars on the MACD histogram indicate a strengthening bearishness of the token’s price momentum.

Bulls Still Struggling To Arrest Downfall

The Waves token’s Bollinger band and relative strength index are forecasting neutral signals for GNO.

In detail, Bollinger bands consist of a simple moving average (middle wave) and an upper and lower band. The two bands are usually two standard deviations from the middle band. Therefore, when an asset’s prices break above the upper bands, it denotes an overbought condition.

The relative strength index for WAVES plummeted back from overbought levels as the token’s prices nosedived. The RSI is currently neutral, clocking 41.81 on the daily charts.

However, long lower wicks on the recent (Apr 5 – Apr 7) daily bearish candles indicate bulls’ buying the dip. If the bulls’ buying spree manages to start an upside rally, WAVES will flip immediate resistance at $32.1 before moving up to target resistance near $35.6

Further upside movement could see the digital token reach resistance from its 20-day MA (red) near $40 before corrections pare prices.

Waves’ Ponzi Issues

Accusations against the Wave team of price spiking seem to be behind the downtrend. On Mar 31, a pseudonymous crypto markets analyst, 0xHamZ, posted a Twitter thread that termed the blockchain platform the “biggest Ponzi in crypto.“

The analyst accused the platform of borrowing other stablecoins to buy USDN to maintain its ecosystem.

I will walk you through how the WAVES team is folding leverage to engineering a massive supply squeeze

Here is the flow
-Deposit USDN on Vires
-Borrow USDC on Vires
-Transfer USDC to Binance
-Buy WAVES with USDC
-Convert WAVES to USDN
-Start over

This is trackable onchain

— 0xHamZ (@0xHamz) March 31, 2022

As the allegations spread, users began withdrawing their stablecoins from Vires, resulting in USDN unpegging. At one time, USDN traded at $0.60 before recovering.

Related: WAVES risks further price crash as ‘Ponzi’ accusations grow.

Meanwhile, Waves Platform founder Sasha Ivanov retorted with a series of tweets in which he said the price spikes were the work of malicious elements. Ivanov accused Alameda Research, a crypto trading firm founded by FTX CEO Sam Bankman-Fried, of manipulating WAVES prices.

At the time of writing, WAVES was trading at $28.2, down 1.95% on the day.