A probe has been initiated by major cryptocurrency exchanges Binance and Bitget into the trading activities surrounding RaveDAO's RAVE token. This comes after ZachXBT, a cryptocurrency sleuth, alleged that insiders manipulated the market, causing a significant short squeeze that led to the token's rapid appreciation. Bitget's CEO, Gracy Chen, confirmed that the exchange has started investigating the matter, while Binance's CEO, Richard Teng, stated that the platform is also looking into the claims and will examine signs of market misconduct. Another exchange, Gate, was implicated in ZachXBT's investigation.
ZachXBT is offering a $10,000 bounty to whistleblowers who can provide evidence about the parties involved. The RAVE token experienced a massive 4,500% rally over a week, resulting in over $44 million in bearish positions being liquidated in a single day.
Notably, nearly 90% of the token's supply was concentrated in three Gnosis Safe wallets at the time. Furthermore, millions of tokens were transferred to exchanges shortly before the price surge began. RaveDAO, a Web3 project focused on electronic music events, has hosted several events across different regions since its inception in 2023 and reported $3 million in revenue in 2025.
The project's token, however, has exhibited unusual market behavior, trading below $0.50 for most of its history before surging in April. The token's value briefly exceeded $6 billion at its peak, placing it among the largest cryptocurrencies by market capitalization. It has since dropped by over 50% from its peak and 30% in the last 24 hours.
Allegations of a 'bait and liquidate' pattern have also surfaced, suggesting that visible transfers may be used to create the illusion of selling pressure, drawing traders into short positions. If those tokens are later withdrawn while prices rise, short sellers may be forced to buy back at higher prices, driving further gains for those on the other side of the trade. Community reports have linked the project to figures associated with earlier crypto ventures, although these connections have not been independently verified. RaveDAO has addressed the situation, stating that the team is not responsible for the recent price action and plans to liquidate portions of unlocked tokens 'when appropriate.' The project is exploring models that tie team incentives to ecosystem growth but has not committed to a specific mechanism or timeline.