Following allegations of a coordinated price manipulation, major cryptocurrency exchanges Binance and Bitget have initiated investigations into the trading activities surrounding RaveDAO's RAVE token. The claims, made by on-chain analyst ZachXBT, suggest that insiders may have engineered a large short squeeze, resulting in the token's rapid price increase. In response, Bitget's CEO Gracy Chen announced that the exchange has started investigating the matter, while Binance CEO Richard Teng confirmed that his platform is also looking into the allegations and will examine signs of market misconduct. Another exchange, Gate, was also implicated in ZachXBT's investigation.
To encourage whistleblowers to come forward, ZachXBT has offered a $10,000 bounty for evidence related to the parties involved. The RAVE token's price surge led to over $44 million in bearish positions being liquidated in a single day, following a 4,500% rally over the course of a week. However, the short squeeze highlighted 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. 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, has reported around $3 million in revenue in 2025. Despite its relatively small footprint, the token's market behavior has been highly volatile, trading below $0.50 for most of its history before surging in April.
The token's price jumped from around $0.30 to over $6 in a single day, then climbed past $27 before starting to recede. At its peak, the token's market value briefly exceeded $6 billion, placing it among the largest cryptocurrencies by market capitalization before dropping. The token is now down more than 50% from its peak and 30% over the last 24 hours.
A separate claim suggests that the project may have engaged in a 'bait and liquidate' pattern, where visible transfers suggest 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 If those tokens are later withdrawn while prices rise, short sellers may be forced to buy back at higher prices, driving further gains for those on the other side of the trade.
These claims remain unproven, but the concentration of supply suggests it's a real possibility. Community reports have linked the project to figures associated with earlier crypto ventures, including ARPA and Bella Protocol, though those connections have not been independently verified.
RaveDAO has addressed the situation in a social media thread, stating that the team is 'not engaged in, nor responsible for, recent price action.' The project confirmed that it plans to liquidate portions of unlocked tokens 'when appropriate' and is exploring models that tie team incentives to ecosystem growth. However, RaveDAO stopped short of committing to any specific mechanism or timeline. CoinDesk has reached out to RaveDAO for comments.