South Korea's Financial Supervisory Service (FSS) 's Virtual Asset Investigation Bureau has launched its first investigation under the Virtual Asset User Protection Act, which came into force on July 18.

The bureau scrutinizes a dramatic price spike of the AVAIL token on the Bithumb exchange in late July.

The probe centers on July 23-24, when AVAIL's price skyrocketed by 1383% in just 15 minutes.

According to regulators, an unnamed investor, referred to as "A", is suspected of orchestrating this surge through a series of rapid transactions.

Rapid Price Surge

At 10 PM on July 23, AVAIL traded at $0.17 per coin. Within 15 minutes, the price soared nearly 15-fold to around $2.56, as reported by Chosun Ilbo. However, the surge was short-lived. Less than a day later, the token's price plummeted to $0.21 around 7 PM on July 24.

Investigators are particularly concerned because while AVAIL's prices were volatile on Bithumb, they remained stable on other platforms.

The FSS suspects that A purchased a large amount of AVAIL from overseas vendors before leading the trading frenzy on Bithumb.

Dominant Market Position

A's crypto wallet showed that he held approximately 1.17 million AVAIL coins at one point. This accounted for about 75% of the 1.55 million AVAIL tokens held on Bithumb during the spike. Regulators believe this dominant market position allowed A to manipulate the coin's price.

"A's social media channels are well-known in the South Korean crypto community," the regulator noted.

Social Media Fundraising

Further investigations revealed that A may have used social media to fund his trading activities. He allegedly told his 22,000 social media followers that he would repay them at a premium after his AVAIL trades.

Investigators identified that owners of 119 wallets sent funds to A, raising over 1.2 million AVAIL coins in the process. It is believed that A returned high profits to these investors while collecting a commission.

As of August 5 at 15:30 UTC, AVAIL traded around $0.09 on the Bithumb exchange. The investigation continues, and the Virtual Asset Investigation Bureau aims to bring clarity and justice to the case.