Plasma founder Paul Faecks has just denied insider sales of XPL tokens after a massive price drop. Can investor interest continue to hold fast?
Plasma’s native token, XPL, has been at the centre of debate after its massive price crash after launch. The controversy deepened when some investors accused the project’s team of selling locked tokens.
Paul Faecks, the founder and CEO of Plasma, publicly rejected the accusations, “No team members have sold any XPL,” Faecks wrote. “Plasma is laser-focused on building the future of money and won’t be commenting further.”
XPL Price Rebounds Following Public Rebuttal
Soon after Faecks’ comments, XPL rebounded by nearly 15%, climbing from $0.88 to $1.01. The gains were later trimmed, but the token stabilised near $0.93.
We’ve seen a number of rumors circulating since the launch of XPL and want to set the record straight.
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…
— Paul (@pauliepunt) October 1, 2025
Some analysts saw the rebound as a sign of fresh investor confidence, even though doubts about transparency continued to hang over the protocol.
Critics questioned whether other categories of tokens, like ecosystem and growth allocations, were being sold, despite their being assured about locked team holdings.
Community Investigations And Further Tensions
Independent researchers traced on-chain movements of more than 600 million XPL tokens from Plasma’s team vault to centralised exchanges, including Binance and Bitfinex.
One analyst, ManaMoonNFT, claimed that wallets linked to Wintermute may have handled a large share of these tokens.
OK so I actually dug into what happened with $XPL, the vaults, and the Wintermute accusations.
First, I wanted to see where the Plasma Team Vault was sending their tokens so I looked at each notable transfer from their vault.
Vault address:… https://t.co/xZgm9D2u0U pic.twitter.com/lKbWmuh2AA
— ManaMoon (@ManaMoonNFT) September 30, 2025
“If team selling happened, it was probably on Binance,” the analyst said.
Faecks dismissed any ties with Wintermute and stated that Plasma had never contracted the firm as a market maker. He added that the project had no special access to Wintermute’s holdings of XPL.
XPL Tokenomics and Distribution
For some more context, XPL powers the Plasma Layer-1 network, which focuses on fast and affordable stablecoin payments. The token allows transaction fees, staking rewards for validators and ecosystem incentives.
During the public sale on July 17, Plasma distributed 10% of the total 10 billion XPL supply to early participants.
Tokens purchased by non-US buyers were unlocked at the mainnet beta launch on September 25, while US buyers face a 12-month lock-up until July of next year.
Plasma allocated 40% of the supply for ecosystem growth. Out of that amount, 800 million were unlocked at launch to support liquidity, defi incentives and exchange integrations.
The remaining 3.2 billion are being gradually released over three years.
The development team holds around 2.5 billion tokens, which are subject to a one-year cliff and a two-year gradual release thereafter.
Community Doubts Despite Growth
Despite the ongoing scepticism, adoption of the Plasma network still seems to be growing. Data from Dune Analytics shows the platform is onboarding roughly 5,000 new users daily.
This accounts for more than 70% of daily active users.
Many observers believe that user growth shows persistent demand for a stablecoin-focused payments network. Some analysts have even compared Plasma’s path to that of Tron, because of its integration with Tether-related services.
However, issues about transparency and the project’s history of controversies continue to hang over investors. Analysts continue to argue that clearer reporting on token movements could help restore trust.
Plasma Faces a Crucial Phase
As Plasma continues down the line, the network’s success may depend on investor trust as much as on technology.
The XPL token’s rebound after the founder’s denial of insider sales shows that sentiment can change quickly with clear messaging.
The next few months will determine whether transparency efforts match the pace of user adoption.
For now, Plasma’s strong onboarding figures indicate that many see value in its model despite its current issues.
