Monero (XMR), a privacy currency, saw a large price increase in the last 24 hours and was one of the best-performing cryptocurrencies. Its recent gains appear to be driven by a liquidity squeeze initiated by some of the token holders.
XMR has risen 10% in the last 24 hours to $267.65, its highest level since late October. Its 24-hour volumes increased by more than $400 million.
The token soared when some holders withdrew the token from major crypto exchanges in order to test the exchanges’ genuine XMR supplies of these exchanges.
XMR boosted by “Monerun”
Last week, XMR holders organized a mass withdrawal of tokens from centralized exchanges on Monday, called the Monerun. The plans were covered through a popular post on Reddit as well as a telegram group associated with the movement.
The Monerun began on April 18, the eighth birthday of the Monero project.
Given the XMR’s privacy-centric ledger Holders wanted to see if exchanges were misrepresenting their token reserves. XMR Holders argued that the highly anonymized nature of the token the only method to test its “real supply” was to create a liquidity crunch.
XMR is the 32nd-largest cryptocurrency, according to Coinmarketcap, with a market cap of $4.8 billion divided between 18.1 million circulating tokens.
Liquidity test or pump-and-dump scheme?
Given there are few regulations in crypto against price manipulation, the Monerun could simply be a ruse by one group to profit off the price increase.
It remains to be seen whether holders will lock in profits at this point, which would cause the token’s price to fall.
XMR’s privacy-centric nature could also mean that the Monerun’s perpetrators will be difficult to trace. The token is the most popular and largest privacy coin.
Other privacy coins appeared to be rallying as well, with XMR competitor Zcash up 14%. Because of their anonymity, the tokens have been a hot topic among authorities, with numerous nations banning them due to their potential use in money laundering. However, privacy proponents argue that privacy coins represent an ideal form of financial privacy.