Plasma founder Paul Faecks has denied allegations of insider token sales after the project’s native XPL token lost more than 50% of its value within days of launch, sparking community anger and onchain speculation.

The blockchain startup rolled out its mainnet beta and native token, Plasma (XPL), on Sept. 25, billing itself as a high-performance layer-1 network optimized for cheaper, faster stablecoin payments. Following the launch, XPL soared to nearly $1.70 on Sunday before sliding to around $0.83 by midweek, according to TradingView data — a steep decline that triggered accusations of insider dumping.

XPL/Tether perpetual contract chart on Binance. Source: TradingView

Founder pushes back on accusations

Addressing the backlash, Faecks flatly rejected claims that insiders had sold into the rally. “No team members have sold any XPL,” he wrote in a Thursday post, stressing that all team and investor allocations are locked for three years with a one-year cliff.

The denial came amid growing speculation that large token tranches had been fed into the market. Several traders suggested that the sell-off pattern resembled time-weighted average price (TWAP) selling — an algorithmic strategy that gradually unloads tokens to limit price disruption.

Onchain sleuths point to suspicious flows

Independent investigator ManaMoon claimed that more than 600 million XPL tokens had moved from Plasma’s vault to exchanges in the days prior to the token’s listing, fueling suspicion that insiders were quietly offloading supply.

Another trader, using the handle crypto_popseye, went further, accusing the Plasma team of collusion with algorithmic trading firm Wintermute. “Plasma $XPL pretty much destroyed their chart and momentum, and I hope their project fails,” the user wrote.

The Plasma team denied any relationship with Wintermute. “We have not engaged Wintermute as a market maker and have never contracted with Wintermute for any of their services,” Faecks said, adding that the team has “the same information as the public” regarding Wintermute’s reported holdings.

Ecosystem tokens spark new questions

Critics, however, questioned the precision of Faecks’ statement. Some community members argued that while team tokens may be locked, his wording left ambiguity over the fate of “ecosystem and growth” allocations — a separate tranche that could potentially have been sold.

“Pretty clear they have been sold, but you are wording your tweet to make it seem like they haven’t,” one commenter responded.

Source: Melardev

For now, Faecks says the focus remains on development. “We are laser-focused on building the future of money,” he wrote, declining to elaborate further.

Cointelegraph attempted to contact the Plasma team for comment but did not receive a response by publication.