A probe has been initiated by major cryptocurrency exchanges Binance and Bitget into the trading activities surrounding RaveDAO's RAVE token, following allegations by on-chain analyst ZachXBT that insiders manipulated a significant short squeeze, resulting in the token's rapid appreciation. Bitget's CEO, Gracy Chen, confirmed the exchange's investigation, while Binance's CEO, Richard Teng, stated that the platform is examining the claims and will always investigate signs of market misconduct.
ZachXBT has offered a $10,000 bounty to whistleblowers who can provide evidence about the parties involved. The lesser-known project experienced a massive rally, culminating in over $44 million in RAVE positions being liquidated in a single day, with the majority being bearish.
The short squeeze drew attention to the concentration of RAVE tokens within a small set of wallets, with nearly 90% of its supply held in three Gnosis Safe wallets at the time. Additionally, investigators flagged token transfers to exchanges shortly before the rally began, with millions of tokens being moved to exchanges before prices started surging.
RaveDAO, a Web3 project focused on electronic music events, has hosted events across several regions since its inception in 2023 and reported $3 million in revenue in 2025. However, the token's market behavior has been inconsistent, trading below $0.50 for most of its history before surging in April. The token's market value briefly exceeded $6 billion at its peak before dropping, and it is now down over 50% from its peak and 30% over the last 24 hours.
Claims of a 'bait and liquidate' pattern have also emerged, suggesting that visible transfers may be used to create selling pressure, drawing traders into short positions. 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.