Major 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 may have orchestrated a large short squeeze, leading to the token's rapid price surge. Bitget's CEO, Gracy Chen, confirmed the exchange has started investigating the matter, while Binance's CEO, Richard Teng, also announced that the platform is looking into the claims and will examine signs of market misconduct. Another exchange, Gate, was also implicated in ZachXBT's investigation.
ZachXBT has offered a $10,000 bounty for whistleblowers to come forward with evidence about the parties involved. The little-known project saw a significant rally, resulting in over $44 million in RAVE positions being liquidated in a single day, with most of these positions being bearish. The short squeeze highlighted the concentration of RAVE tokens within a small set of wallets, with nearly 90% of the supply held in just three Gnosis Safe wallets at the time.
Investigators also flagged large 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, offering blockchain-based ticketing and community governance, has reported $3 million in revenue in 2025. However, the token's market behavior has been contrasting, with RAVE trading below $0.50 for most of its history before surging in April.
The token jumped from about $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 cap before dropping.
The token is now down more than 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, which can then be used to drive 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.
The project plans to liquidate portions of unlocked tokens 'when appropriate' and is exploring models that tie team incentives to ecosystem growth.