New Study Alleges FTX and Alameda Research Utilized Social Media Bots to Influence Crypto Markets
New research conducted by the Network Contagion Research Institute (NCRI) has raised concerns about potential market manipulation involving Twitter bot accounts and their impact on digital assets listed on the troubled crypto exchange, FTX, and traded by Alameda Research, its hedge fund arm.
The study analyzed over three million tweets spanning from January 1, 2019, to January 27, 2023, mentioning 18 cryptocurrencies previously listed on the now-defunct FTX exchange. The research indicates that FTX’s former head, Sam Bankman-Fried, was aware of Twitter’s significant influence on cryptocurrency prices, where perceived value, often driven by social media hype, could lead to inflated market capitalizations. The study questions whether FTX engaged in a Twitter scheme to artificially inflate token prices, as bot-like tweets seemed to have affected these assets’ prices. The research suggests that the surge in social media activity was not solely organic but possibly a strategic ploy to influence market sentiment.
The study also notes that bot activity increased after FTX officially promoted the digital assets, indicating a possible connection. Notably, Bankman-Fried is currently facing numerous charges related to the November collapse of FTX, including allegations of customer fraud and mishandling of funds worth billions of dollars.
Clever Robot News Desk 4th August 2023
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