Gotbit’s $42m manipulation case could strengthen crypto market resilience: Santiment

Santiment predicts that Gotbit’s multi-million dollar accusations could trigger FUD, but fear-based selling could trigger a rapid recovery.

Recent accusations of a $42 million crypto market manipulation scheme against Aleksei Andriunin, CEO of market-making firm Gotbit, have sent shockwaves through the industry, but analysts suggest the end result could actually be positive for the space.

As Crypto.news previously reported, Andriunin and Gotbit are accused of inflating crypto trading volumes through “fake trading” by creating the illusion of active markets before selling assets at inflated prices. Despite the short-term panic, blockchain analytics Santiment points to historical trends that show such fear-driven selling often creates buying opportunities for more experienced investors.

Brian Quinlivan, chief marketing officer at Santiment, emphasized in a recent blog post: “Markets tend to move in the opposite direction of the crowd’s expectations, especially when fear-driven retail activity dominates the headlines.”

“While the immediate reaction may be a small decline as news of the manipulation scheme spreads, there is a strong possibility that the market will digest the panic and quickly reverse direction.”

Brian Quinlivan

He noted that panic selling could lead to a capitulation effect, where the worst-case scenario is already priced in, setting the stage for a potential bullish trend reversal, creating opportunities for institutional investors and market participants.

Santiment warns that the broader crypto market could face short-term disruptions “especially those directly linked to manipulation, such as Robo Inu and Saitama.” However, Quinlivan emphasized that “moments of extreme FUD often coincide with market bottoms” and that removing Gotbit’s market manipulation practices could lead to “a healthier, more transparent trading environment, increased trust in cryptocurrency markets.”

Gotbit, which has been operating since 2017, was co-founded by Andryunin and Iuliia Milianovich. According to the company’s statement, its platform-based solution aimed to give project founders more control over their markets. In July 2019, Andryunin publicly acknowledged that the firm’s business was “completely unethical” and expressed his intention to cease market-making activities due to difficulties with strict customer identification processes.

The firm’s website listed leading crypto exchanges and venture firms in its “our friends” section, including Binance, OKX, Crypto.com, a16z, Gate.io, and Bybit. However, it remains unclear whether these entities have any official connection with Gotbit.