Plasma CEO has denied insider trading allegations after native token XPL has dropped over 45% from its all-time high days after launch.
Author: Sahil Thakur
2nd October 2025 – Plasma’s native token XPL has dropped over 45% from its all-time high, just days after launch. The sharp fall triggered accusations of insider selling, ties to controversial market makers, and team exits. But Plasma CEO Paul Faecks has denied all allegations.
XPL launched in late September around $1.00. It quickly surged to $1.69 by September 28. But just days later, the token dropped to a range of $0.74–$1.08, alarming holders and traders.
On-chain observers flagged large token movements, which fueled claims that insiders or affiliated market makers had sold significant allocations. Social media also highlighted past links between some Plasma team members and other projects like Blur and Blast, adding to the speculation.
The situation led to widespread fear, uncertainty, and doubt (FUD) across crypto circles.
On October 1, Paul Faecks addressed the rumors via a public statement on X. He clarified that all team and investor tokens are under a three-year lockup with a one-year cliff. According to Faecks, only public sale and liquidity allocations have entered circulation.
He said the allegations of insider selling were “completely false.”
Faecks also responded to claims of Plasma’s connection with Blast. He stated that just three of the company’s nearly 50 employees had any history with Blur or Blast. The broader team, he added, includes former professionals from companies like Google, Facebook, Goldman Sachs, and Temasek.
Another major rumor involved market maker Wintermute. Some users speculated that the firm was involved in behind-the-scenes token activity. Plasm CEO Faecks denied this, stating Plasma has never hired Wintermute or engaged the firm in any way.
He emphasized that the team has no access to insider data and can only see publicly available blockchain information.
Despite the market reaction, Plasma continues to show strong fundamentals. The project raised $373 million in July, far surpassing its $50 million target. Within hours of XPL’s token generation event on September 25, trading volume exceeded $3 billion. Major exchanges such as Binance, OKX, and Upbit listed the token on day one.
Plasma now claims over $2 billion in stablecoin total value locked (TVL) and more than 100 decentralized finance (DeFi) integrations. The team positions the chain as a specialized Layer 1 focused on stablecoin infrastructure.
Yet, investor sentiment remains mixed. Some believe the price correction is part of normal post-ICO activity. Others warn of persistent sell pressure, especially from early buyers realizing profits.
Crypto analysts differ on what happens next. Some call the drop a healthy correction after an overheated launch. Others see structural issues that could continue to weigh on XPL’s price.
Faecks concluded his statement by emphasizing Plasma’s focus on long-term development. He said the team is committed to building infrastructure, not chasing hype.
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