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Four Crypto Traders Accused of PAAL AI Pump and Dump Scheme

2 mins
Updated by Kyle Baird
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In Brief

  • ZachXBT accuses TraderNJ, PetaByte, XO, and Trader SZ of participating in a pump-and-dump scheme involving PAAL AI.
  • TraderSZ allegedly started promoting PAAL AI on social media shortly after receiving tokens from the project.
  • A message from Petabyte suggests its combined follower count could reach up to 2.67M organic followers.
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ZachXBT, a blockchain investigator, has provided evidence alleging the involvement of four prominent online traders in a pump-and-dump scheme with the Ethereum token PAAL AI.

“All in all we could potentially have reach up to 2.67m organic followers,” a leaked message from the accused trader’s telegram group read.

PAAL AI Tokens Received Ahead of Promotions

On September 11, ZachXBT asserted in a series of posts on X (formerly Twitter) that TraderNJ, PetaByte, XO, and Trader SZ were allegedly involved in a pump-and-dump scheme, aiming to profit at the expense of their followers.

ZachXBT posted a diagram on social media that illustrated various transactions between crypto wallets, with a particular focus on the PAAL AI project.

He further explains that shortly after receiving tokens from the project, Trader SZ began promoting the token on social media:

“Trader SZ received 4M PAAL from their team on Aug 10 and began shilling a few days after. Shortly after that was when he began dumping.”

PAAL AI Movements Between The Four Crypto Traders Diagram. Source: ZachXBT
PAAL AI Movements Between The Four Alleged Crypto Traders Diagram. Source: ZachXBT

PAAL AI’s price surged from $0.017 on August 10 to reach an all-time high of $0.0451 by September 3.

The allegations came with the publication of various telegram text and audio messages. An alleged message from Petabyte was revealed to the group chat that read:

“Many of these guys are our personal frens irl. Can ensure they’d be willing to get on board on our say so.”

He further pointed out that their combined following would reach up to 2.67 million organic followers.

To learn more about crypto scams, read BeInCrypto’s guide: 15 Most Common Crypto Scams To Look Out For

ZachXBT’s Ongoing Crypto Investigations

ZachXBT has earned a reputation for boldly exposing fraudulent projects and scams within the crypto industry.

However, this has resulted in him encountering legal challenges. On June 17, reports revealed that Jeffrey Huang, known as MachiBigBrother on Twitter, sued ZachXBT over an investigative article he wrote in 2022.

ZachXBT stated that the lawsuit was “baseless and an attempt to chill free speech.” The anonymous blockchain investigator vowed to contest the legal action. However, he sought assistance from the community to cover the associated costs.

In a matter of hours, he garnered a total sum of over $600,000 in donations. Notable figures such as Binance CEO Changpeng ‘CZ’ Zhao and Kraken founder Jesse Powell are also among the prominent supporters.

Both ZachXBT and Huang took to their social media on August 15 to announce that Huang had dropped the lawsuit.

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Ciaran Lyons
Ciaran is a cryptocurrency journalist based in Sydney, Australia. He particularly enjoys writing about CBDC developments and the practical implementations of cryptocurrency in real-world scenarios. He has also appeared across major television networks in Australia including Channel Ten, Channel Nine and SBS TV. Prior to his foray into cryptocurrency, Ciaran worked as a presenter on national radio station Triple J.