As Bitcoin price dropped by almost 6% on Sunday, some Bitcoin critics believe that the sudden pumps and dumps can be seen as the market manipulating.

Mati Greenspan, senior market analyst at eToro conducted a poll on Twitter, asking the general population about the reason of “Sunday’s sudden drop of 5.85% in an hour”. Greenspan gave four options for the participants to attribute the drop, including cryptocurrency bots, Bitcoin whales, price manipulation or something else.

Settle this for us Twitter. Sunday's sudden drop of 5.85% in an hour was due to… — Mati Greenspan (@MatiGreenspan) January 21, 2019

According to the result, most of the people believed that manipulation is the main cause of Bitcoin’s sudden drop with 49% of votes.

Although the result is not scientific significant enough to explain the current market movements, it does give an idea of how crypto investors perceive the price fluctuations. Almost half of the crypto enthusiasts engaged in the poll believed that manipulation can be a real issue in crypto industry.

Some speculated that the sudden pumps and dumps in Bitcoin price are artificial that force the market to liquidate. Big players take the advantage of these liquidations to facilitate closeout and then create peaks for profit which undermines the interests of day-traders.

Many academics also join the Bitcoin manipulating debate. The most common argument targeted Tether (USDT). John Griffin and Amin Shams investigated whether USDT is used to manipulate the price of Bitcoin in their report “Is Bitcoin Really Un-Thered”.

According to the paper, “purchases with USDT are timed following market downturns and result in sizable increases in Bitcoin prices” which “cannot be explained by investor demand proxies but are most consistent with the supply-based hypothesis where USDT is used to provide price support and manipulate cryptocurrency prices”.

Source: Griffin & Shams (2018)

Griffin & Shams did the statistic analysis and claims that “Tether is used to purchase Bitcoin when returns are negative, but we do not find considerable Tether flows following price increases.”

However, financial analyst Alex Krüger says that this statement is misleading. In a post on Medium, he argued that the paper confuses “speculation” with “manipulation” and ignores the validity of buying retracements as a trading strategy.

Krüger indicated that bitcoin crashes prompt investors to exchange their BTC for USDT which causes USDT trading at a premium to USDT. When the USD/TUSD largely deviates from $1, arbitrageurs are incentivized to bring USDT back to synchronization

The financial analyst believed that, in a bear market, purchasing BTC with USDT is quite common which could be explained by demand from market participants buying the dip or just arbitraging spreads across exchanges. Which represents no proof of market manipulation.