Plasma’s XPL token has seen sharp volatility since its late September debut, dropping about 45% from its all-time high. The decline has fueled speculation on social media about insider selling, ties to past projects, and involvement from major market makers. In response, Plasma co-founder and CEO Paul Faecks has denied the claims, stressing that neither the team nor early investors have sold tokens.
XPL’s Rise and Fall
The token launched around $1.00 on September 25 and quickly climbed to $1.69 by September 28, before sliding back into the $0.74–$1.08 range in the days that followed. The steep pullback triggered community concerns and accusations that insiders had exited large positions.
CEO’s Response to Accusations
On October 1, Faecks addressed the rumors directly on X (formerly Twitter). He clarified that all team and investor allocations are subject to a three-year lockup with a one-year cliff, making insider sales impossible at this stage.
We’ve seen a number of rumors circulating since the launch of XPL and want to set the record straight.
— Paul (@pauliepunt) October 1, 2025
1/ No team members have sold any XPL. All investor and team XPL is locked for 3 years with a 1 year cliff.
2/ Of our team of ~50, three spent time at Blur or Blast. Our team…
“All investor and team XPL is locked,” he stated, adding that the circulating supply only comes from the public sale and liquidity allocations.
He also responded to criticism over the team’s background. While a handful of employees previously worked with Blur and Blast, Faecks emphasized that this represents just three of Plasma’s roughly 50 staff. He highlighted that the team also includes professionals from companies such as Google, Facebook, Square, Goldman Sachs, and Temasek.
Regarding speculation about market maker Wintermute, Faecks said Plasma “has not engaged Wintermute as a market maker and has never contracted Wintermute for any of their services.” He stressed that the company has no insider knowledge about Wintermute’s token holdings beyond publicly available information.
Building Beyond Market Volatility
The controversy follows a widely watched token generation event on September 25, which drew more than $3 billion in trading volume within hours and listings on major exchanges including Binance, OKX, and Upbit.
Plasma had already raised $373 million in July through a public sale, far surpassing its $50 million goal. The network launched with $2 billion in stablecoin total value locked and more than 100 decentralized finance integrations, positioning itself as a specialized layer-1 chain for stablecoin applications.
The Plasma public sale has ended with $373M+ committed to purchasing XPL, representing more than 7x in oversubscription.
— Plasma (@Plasma) July 28, 2025
Plasma mainnet beta will launch with $1B in stablecoin TVL, the fastest chain to reach this number in history.
We're grateful for your support and trust. pic.twitter.com/Pddsoa02c0
Despite these fundamentals, visible large wallet transfers and rapid price swings heightened skepticism in the community. Some critics argued the launch disadvantaged retail buyers, while others accused the project of facilitating a “whale-sale.”
Faecks pushed back on these narratives, underscoring that Plasma’s mission is to build long-term infrastructure rather than chase speculative hype.
Outlook
At present, XPL trades about 40–45% below its peak. Whether the founder’s reassurances can stabilize sentiment will depend on transparency, continued growth in Plasma’s stablecoin ecosystem, and broader conditions in the altcoin market.
