ICP Subject To Rug Pull Allegations – Is It A Scam?

The ICPcryptocurrency was launched on May 10, and at the time of going live, it was trading at an estimated price of around $630. However, shortly after being launched, it lost nearly 95% of its value, which prompted most people to believe that the token had rug pulled on its investors.

Was ICP’s 95% Fall a Rug Pull?

Dfinity, the company behind the ICP tokens, is believed to be behind the rug pull and other incidents of insider trading. Many investors lost much money following a sharp decline in ICP’s value.

The price crash and insider trading allegations led to a lawsuit against the firm before the US District Court for the Northern District of California. According to the lawsuit, Dfinity and other parties with insider knowledge sold a large portion of their assets, which led to a sharp decline in the token’s price from $2800 to around $66.

This massive sale led Dfinity and its affiliated partners to make millions if not billions in profits, while investors counted massive losses. While Dfinity is based in Switzerland, it has a subsidiary in the USA, which could make it subject to regulations by the US Securities and Exchange Commission (SEC).

It is not the first time for something like this to happen in the crypto space. Most of the cryptocurrencies, especially those with zero use cases, are scams. Hence, their founders could rug pull on holders, and while investors make immense losses, the founders of these coins and tokens make immense profits.

Is ICP a Scam?

Many key factors on how ICP lost 95% of its value after a few weeks of launch point towards the project being a scam. However, other factors could also make the token genuine. Most new altcoins lose massive value, and the case with ICP is not any different

Moreover, unlike other cryptocurrencies that rug pull and the founders end the project altogether, ICP is still available for trading on major exchanges. It ranks as the 26th largest cryptocurrency with a market cap of around $7 billion, showing that many investors are still holding the token.

In addition, unlike most rug pulls, ICP has a use case, according to what Dfinity stated in its whitepaper. Internet Computer is an open-source protocol aimed at boosting the computer systems’ functionality and reducing dependence on companies such as Google and Amazon.

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