Blockchain investigator ZachXBT has accused four high-profile online traders—TraderNJ, PetaByte, XO, and Trader SZ—of participating in a pump-and-dump scheme. Significantly, the scheme centers on the Ethereum token PAAL AI. ZachXBT disclosed the allegations on September 11 in a series of posts on social media platform X, formerly Twitter.
Moreover, the investigator presented a diagram highlighting transactions between crypto wallets, primarily focusing on the PAAL AI project. According to ZachXBT, Trader SZ received four million PAAL tokens from the project team on August 10 and began promoting them shortly after. Consequently, the token’s price rose from $0.017 to an all-time high of $0.0451 by September 3.
Additionally, ZachXBT released various Telegram text and audio messages to corroborate the allegations. One leaked memo from the accused trader’s group chat stated, “All in all, we could potentially have reached up to 2.67m organic followers.” Another letter from PetaByte suggested the group’s combined following could reach up to 2.67 million organic followers.
However, this isn’t ZachXBT’s first run-in with controversy. The investigator has garnered a reputation for exposing scams in the crypto industry. On June 17, he faced a lawsuit from Jeffrey Huang, known as MachiBigBrother on Twitter, over an investigative article he wrote in 2022. ZachXBT dismissed the lawsuit as “baseless” and an attempt to stifle free speech. Within hours, he raised over $600,000 in community donations to contest the legal action. Notable contributors included Binance CEO Changpeng “CZ” Zhao and Kraken founder Jesse Powell.
ZachXBT and Huang later announced on August 15 that the lawsuit had been dropped. Hence, despite facing legal challenges, ZachXBT remains committed to exposing fraudulent activities within the crypto space. This latest investigation underscores the need for transparency and accountability among influencers in the rapidly evolving crypto market.