The AI Prophecy memecoin has plummeted more than 70% within three days, following Binance’s modification of leverage and margin tiers for the ACT/USDT trading pair, which triggered widespread liquidations and forced sell-offs.
The AI Prophecy (ACT) continues to decline, currently priced at $0.05, representing a 24% drop in the last 24 hours. This downturn commenced on April 1, as part of a larger market slump that saw numerous altcoins on Binance experience losses of between 20% to 50% in just one day. ACT encountered the most significant setback, plummeting nearly 60% from $0.19 to $0.08 in under an hour, resulting in a market cap reduction of $96 million.
In light of this situation, the ACT development team has initiated an inquiry to determine the underlying cause of the price crash. Yesterday, they shared an update indicating that the decline was related to Binance’s recent adjustments in leverage and margin tiers affecting various tokens, including ACT.
On April 1, Binance limited the maximum leverage position for ACT/USDT futures to $4.5 million and altered margin tiers, notifying traders merely three hours prior to the changes. Consequently, those who held leveraged positions on ACT were compelled to reduce their holdings, which led to considerable sell pressure. An investigation by Binance attributed the price crash to four users—three VIP traders and one non-VIP—who sold over $1 million worth of ACT on the Binance spot market collectively.
The incident led to a staggering 57% decline in ACT’s price on April 1 alone, with the price starting at $0.19 and closing at $0.08 that day. On April 2, ACT continued its downward trend, losing an additional 35% and stabilizing around $0.05. The market cap now stands at $49.5 million, reflecting a 94% decrease from its peak of $890 million.