Following allegations of a large-scale short squeeze orchestrated by insiders, leading cryptocurrency exchanges Binance and Bitget have initiated investigations into the trading activity surrounding RaveDAO's RAVE token. The claims, made by on-chain analyst ZachXBT, suggest that a significant price surge was artificially engineered, resulting in substantial losses for traders holding short positions. In response, Bitget's CEO, Gracy Chen, and Binance's CEO, Richard Teng, have publicly stated that their respective platforms are looking into the matter, with Teng emphasizing Binance's commitment to examining potential market misconduct.
ZachXBT has also offered a $10,000 bounty for any whistleblowers who can provide evidence related to the alleged manipulation. The RAVE token's price skyrocketed by 4,500% over the course of a week, resulting in over $44 million in liquidations, primarily from bearish positions. Notably, nearly 90% of the token's supply was concentrated in just three Gnosis Safe wallets, and millions of tokens were transferred to exchanges shortly before the price surge began.
RaveDAO, a Web3 project focused on electronic music events and blockchain-based ticketing, has denied any involvement in the price manipulation, stating that the team is not responsible for the recent price action. The project has, however, announced plans to liquidate portions of unlocked tokens and explore incentive models that tie team performance to ecosystem growth. As the investigation unfolds, the RAVE token's market value has dropped by over 50% from its peak, highlighting the volatility and risks associated with cryptocurrency markets.