Filecoin dips further after a 56% drop in the past 30 days: here’s why it’s dropping

The price of Filecoin (FIL) has dropped by more than 56% in the last 30 days as the firm continues to face allegations of pyramid schemes and fraud and is now under police investigations.

 It has dropped by 2.41% today to trade at $8.19.

The Boss of Filecoin’s largest firm under police custody

Shikongyun boss, Filecoin’s largest firm in China, Lai Chuhang has been arrested by Guangxi police after being suspected of organizing pyramid schemes and fraud.

However, this is not the first case as a couple of Filecoin companies in China were under police investigation in November last year after running FIL mining scams and pyramid schemes.

During the investigation, the police arrested about 30 suspects who had seized over $50 million during the scam.

Chinese government action on pyramid schemes

Chinese police have continued with the crackdown on the suspected Filecoin companies running mining pools in the country. Several agents carried out pyramid schemes to increase project participation after which the Chinese media reported in 2019, that the scheme raised about $300 million.

However, Shikongyun’s authority and technical account have been transferred to the police at the moment after which the services will resume after the investigations are over.

Besides, some executives are currently collaborating with the police to provide evidence. However, some employees have been released back to their jobs by the police after helping the police with the investigations.

Filecoin (FIL) price trend

Filecoin price has been dropping since last year September and is currently at 89% drop for the past 9 months following the fraud and scams reports. 

At the time of writing, FIL was trading at $8.25 down 1.86% in the last 24 hours from an all-time high of $237.24 set a year ago on April 1.

In addition, the current drop in Filecoin price has also been highly influenced by the current crypto market crash.

Filecoin Foundation partnership with Lockheed Martin

As the price of FIL continues with the dip, Filecoin Foundation and Lockheed Martin, an aerospace company, have planned to carry out an InterPlanetary File System (IPFS) node in space to increase data downloads as well as allow network participants to share or hold information.