Cryptocurrency exchanges Binance and Bitget have initiated investigations into the recent trading activity surrounding RaveDAO's RAVE token, following allegations by on-chain analyst ZachXBT that insiders orchestrated a large short squeeze, resulting in the token's rapid price increase. Bitget's CEO, Gracy Chen, confirmed the exchange has started investigating the matter, while Binance's CEO, Richard Teng, stated that the platform is also examining the claims and will take action to address any signs of market misconduct. Another exchange, Gate, was also implicated in ZachXBT's investigation.
ZachXBT has offered a $10,000 bounty to whistleblowers who come forward with evidence about the parties involved. The lesser-known project experienced a significant rally, resulting in over $44 million in RAVE positions being liquidated in a single day, with the majority of these positions being bearish.
The token's price surged by 4,500% over the course of a week, with nearly 90% of its supply concentrated in just three Gnosis Safe wallets at the time. Investigators have also 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, offers blockchain-based ticketing and community governance, and has reported $3 million in revenue in 2025.
However, the token's market behavior has raised concerns, with RAVE 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 by over 50% and 30% in the last 24 hours. Allegations of a 'bait and liquidate' pattern have also emerged, 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If those tokens are later withdrawn while prices rise, short sellers may be forced to buy back at higher prices, driving further gains for those on the other side of the trade. RaveDAO has addressed the situation, stating that the team is not responsible for the recent price action, but did not address specific on-chain allegations, including supply concentration or the millions transferred to exchanges ahead of the pump.